The first 90 days: how to increase customer loyalty
When a customer joins your customer loyalty programme the clock starts ticking on 90 days. That’s the amount of time you have to nudge their behaviour so that you move from being a one-off supplier into their first port of call.
During this period many customer loyalty programmes rely on a collection of gimmicks and aggressive marketing to try and bully customers into repeat purchases. Short-term this might create a kick in revenues, but over the longer term these techniques do not build the strong, profitable habits that effective loyalty programmes seek.
Designing those first 90 days is critical to success and there are five key areas that my experience suggests you should pay particular attention to.
A Proper Welcome
Most programmes rely on a single announcement at the point the customer signs up to welcome them. An email is sent out or the customer is handed their card at the counter without any further follow-up. They’re then expected to retain this information and recall it when the promotional messages start coming their way.
Sending a second “welcome” message two or three days after they join helps the customer to remember they’re a part of your programme and gives you the opportunity to resell the benefits of it. Remind the customer how the programme works, demonstrate how quickly they can secure discounts and present them with information on how many “points” or rewards they’ve secured just from signing up and that first transaction. A day later the first independent promotion can arrive at their inbox, already primed and ready to be acted upon.
Gather Data At Every Opportunity
Profiling customers from the outset is critical to ensure you can deliver relevant promotions and rewards. Yet few programmes do this actively. Instead they rely on sales data to make assumptions, ask customers to complete long winded profiles or worse yet – don’t profile at all.
It’s far easier for a customer to answer a single question, so seed the first 90 days with them. Ask customers natural language questions in exchange for rewards and chain them together to construct your profile. Each time they touch the website or interact with a promotional message ask another question and build up the personalisation profile.
Don’t be Greedy
An element of panic can come across in some programmes during the early days of membership. “Welcome offers” and heavy messaging takes place that’s designed as a crude attempt to get the customer to buy more and create a “habit” of shopping with the provider first. This pace is not only difficult to maintain, it can easily alienate people.
The first 90 days is about consolidation and nudge. Consolidation is about demonstrating value to the customer as a business, reminding them of the positive experience they had and proactively putting yourself forward for when they decide to buy again. Nudge is about encouraging them to buy again, but to increase either the amount they spend with you or the frequency with which they may have bought.
It’s little use gathering data if you’re not going to use it. Personalising messages is a must, but so too is presenting relevant messaging and promotions. Working with known data is also essential to avoid making assumptions about the customer that could harm the relationship or suggest you’re not going to be valuable to them.
For example, if the customer has identified as “Mr” Smith it is reasonable to assume they are male, even if they’ve purchased “traditionally” female items. Initial seeding may be better focused on the male clothing line to present direct relevance and establish whether there is an ongoing need for female items through questioning. This will help ensure Mr Smith isn’t put off by being bombarded with female clothing offers when all they’ve done is bought a one-off gift.
The Programme is Part of Your Experience
All too often customer loyalty programmes are tagged onto the outside of the experience. Although they’re spoken of in strategic terms in practice they’re implemented as tactical solutions to try and generate more income or profit. When this happens a disconnect can occur between what the programme is trying to achieve and the customer’s experience.
The programme should be embedded into the experience, with every opportunity taken to remind them of its value and allow them to earn and redeem rewards. This all needs to be done in a way that is integral to the experience so that using the loyalty programme becomes a natural component of their buying decisions.
90 Days to Customer Loyalty?
The first 90 days are the most critical in a customer loyalty programme. That’s when you have the opportunity to affect the customer’s behaviour and nudge them into a closer and more valuable relationship. To be successful you need to welcome them correctly, gather and use appropriate data and focus on delivering value to them through relevant messages and offers. Above all ensure that loyalty is embedded into your customer experience. If you focus on these key areas you’re far more likely to build loyal, profitable relationships with customers.