Leveraging Loyalty in Uncertainty
In moments of uncertainty—be it economic, political, or social—many businesses embrace what’s familiar with the overall goal of maintaining control. Consumers respond in similar ways, less likely to make new decisions and instead opting to align with the life patterns and brands they trust. Loyalty programs, which are proven conduits for building trust between customers and brands, remain an especially powerful tool during times of uncertainty. Through these loyalty relationships, customer needs can be met, and brands can achieve greater success.
Brands should remind and reinforce the value of a loyalty program to their customers. This goes beyond simply offering tangible and appealing benefits. Brands need to help their customers leverage that value—particularly when the economic and social landscapes are less than rosy. As customers’ discretionary spending shrinks, the brands that thrive show customers that their ongoing engagement and loyalty can yield tangible returns (e.g., personalized offers and rewards) and other valuable benefits, such as exclusive access to new products or special events.
Especially in uncertain times, successful brands work to deliver a sense of community, and of shared experience and support. When done well, those efforts forge strong and lasting bonds with customers—a core business benefit of loyalty.
Loyalty as a safe harbor
When customers are feeling somewhat destabilized by uncertainty, loyalty programs can be a source of value, comfort, connection, and positive reinforcement.
Consider these strategies for making loyalty one of your brand’s key strengths, even when your customers may be spending more cautiously.
1) Be transparent and empathetic
Meet your members where they are. Interacting with members in a clear and human way can go a long way toward earning their trust and deepening emotional ties with your brand. Here are some strategies to consider:
- Name the challenge
Euphemistic communications can just frustrate customers. It may be best to directly (and carefully) communicate with customers about the uncertainty of the moment, such as rapidly shifting economic policies or the increasing price of materials. - Be upfront and direct about any program changes
Members are savvy. Explain in a direct way why your loyalty benefits or points-earning formula need to change. They’re likely adjusting their decision-making in response to current uncertainties as well. - Deliver exceptional customer service
Address member concerns promptly and with a human touch. Find ways to go the extra mile to resolve member concerns to actively demonstrate that you care about them and their brand experiences. - Find opportunities to reach out
Messages of support and offers of help can go a long way toward reminding members about your brand’s values, especially in challenging times.
2) Deliver value when it matters
Reinforcing and highlighting program value can ease members’ concerns.
- Look for ways to build goodwill
Be conscious of customers’ stretched wallets. For example, when it’s financially viable, consider extending points expiration dates or new benefit options. - Highlight relevant benefits
It’s always a good practice to design savings and experiences that are appealing and pertinent to your best customers—and then communicate about them in ways that are easily digestible. These loyalty best practices are even more vital in uncertain times. - Focus on personalization
It’s not news that members expect communications, offers, and benefits that address their preferences. But in uncertain times, digital personalization strategies that help deliver relevant and timely loyalty offerings are even more meaningful. - Keep redemption flexible
Give members options to keep them redeeming—e.g., smaller rewards that are more easily earned, cash-and-points options, or cash-equivalent choices, such as gift cards. - Focus on a broad definition of value
Consider offering members options that boost value beyond points and discounts. For example, deferred payment options and price guarantees can appeal to budget-conscious customers.
3) Focus on your best customers
Protect your core customers who represent the majority of your revenue.
- Reward consistent engagement
Reinforce the value of staying loyal by finding ways to acknowledge members who keep coming back, even if they’re spending less than usual. - Design alternative earning and engagement opportunities
Keep customers engaged by offering ways to earn points that aren’t exclusive to purchases—e.g., completing surveys, referring friends, or social media engagement.
4) Offer uplifting ways to brighten days
Bring joy, emotion, and positivity to your members.
- Invest in spreading joy
Find ways to deliver the memorable, positive experiences members crave and joy they may need in these uncertain times. Make sure they align with your brand’s values and delight your most loyal customers, forging emotional bonds that will fuel ongoing loyalty. - Nurture wellness
Seek out partnerships that promote well-being. Foster connection and community through events or benefits that bring together like-minded customers.
Finding ways to connect with customers through shared values and with a genuine desire to improve their lives can help brands generate much-needed business while building lasting emotional loyalty that continues to pay off.
Loyalty programs and strategies always demand a balance among business goals, brand values, and customer caretaking. When brands achieve that balance during challenging times, loyalty can generate much-needed revenue while fostering valuable long-term devotion.
For more on this topic, check out our white paper Navigating Turbulent Times: Growing Brand Devotion Is Your Best Investment.
Michelle Wildenauer is executive vice president, Client Services and Strategy, at The Lacek Group. For more than 30 years, The Lacek Group has been perfecting the art and algorithms of brand devotion. We help world-class brands identify their highest-potential customers, engage them across channels throughout their lifecycles, personalize each relationship for optimal long-term results, and measure the true effectiveness of those efforts. The Lacek Group is an Ogilvy One company.
