Participation in loyalty programs has been shown to result in loyalty enrollment; that is, program members are more likely to continue doing business with a company or brand if they are enrolled in a loyalty program. This loyalty can lead to increased sales and customer lifetime value. Therefore, it is important for companies to encourage their customers to participate in loyalty programs. There are a number of ways to do this, such as offering incentives for signing up, providing exclusive benefits to loyalty members, and making it easy to sign up and participate. By taking these steps, companies can encourage loyalty enrollment and reap the benefits of loyal customers. What factors affect participation?
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Data for today’s episode is provided by Mercator Advisory Group’s Report: How Payments Can Drive Better Loyalty and Rewards Programs
Constructed factors affecting loyalty enrollment and participation:
- Constructed factors are factors that are within the merchant’s control.
- The enrollment process is too difficult.
- Too much personal data is requested.
- There is no mobile app.
- The POS process is too cumbersome.
- The store offers are not relevant.
- The store rewards are not significant.
Mercator Advisory Group’s most recent report, How Payments Can Drive Better Loyalty and Rewards Programs, provides insight into the new technology driving increased personalization and better customer experiences with loyalty programs, and the important role that payment data can play.
Traditional loyalty programs were a source of data for merchants, better enabling them to identify the repeat customers and track the shopping patterns by rewarding their repeat purchases. The digital environment now gives us an abundance of data that is captured in many ways and in many places, moving these programs to become a use of data that provides a better understanding of customer behavior and the more targeted rewards.
Strategic operating decisions that merchants make in key payments areas including orchestration, tokenization, and service provider selection will affect the ability of the marketing team to mine the loyalty data from payments and has the potential to either enhance or detract from the effectiveness of the loyalty program.
“This is a highly relevant and impactful report,” stated Don Apgar, Director of the Merchant Services and Acquiring practice at Mercator Advisory Group, and author of the report. “We are following this among a number of growing trends that are making payments a frictionless and invisible part of our everyday activities.”