Organizations’ incentive programmes may benefit even more from audience segmentation because loyalty programmes boost client retention and enable corporate growth. Customers are embracing these programmes in today’s digital environment; in fact, Gartner reports that adoption of loyalty programmes increased by 70% in the retail sector. However, this has increased market competition. Loyalty programmes must be distinctive, behavior-based, and packed with personalised value in order to have the desired impact.
How to Segment Data Effectively
The tactics for your company’s loyalty programme should enhance the overall consumer experience. By making sure that your consumers feel valued, you may increase the return on investment for your business. According to Forrester research, 89% of US online adults participate in at least one loyalty programme. Your business should leverage segmentation’s power to build a successful loyalty programme that stands out from the competition. Before we go into how to design an unmatched programme, let’s look at a typical problem that many loyalty programmes face.
Your Loyalty Program System Has a Bug
Getting the attention of modern customers requires personalization. Lack of relevance in loyalty programmes is a problem that affects many firms. In today’s cutthroat industry, the standard punch card or email discounts won’t cut it in terms of a stimulating experience. According to Forrester, only 5% of US internet adults believe that email offers are properly timed to their needs, even though 90% of marketers we surveyed use email programmes as part of their loyalty strategy.
Customers shop differently, therefore engaging them all the same is ineffective. As a result, loyalty programmes should target different audiences with appropriate offers and campaigns; offer management is the preferred method for doing this.
When it comes to developing loyalty programmes and gauging their effectiveness, brands make the mistake of putting too much emphasis on behavioural drivers and not enough on emotional factors. Customers are more likely to return to businesses that make them feel valued and appreciated, or, in other words, those that elicit pleasant emotions, given the wide range of options available.
Remember that while behavioural incentives are simpler to quantify, emotional incentives are what will lead to increased client loyalty and business expansion. You can combine, store, and activate all of your customer data in one location with the insight-led customer experience platform Mapp, enabling you to design streamlined, emotion-driven experiences.
How to segment your audience
We can now plan out the proper road for firms to take in order to succeed with loyalty programmes after observing where they might take the incorrect turn. Loyalty is certain to rise with a customer-centric strategy. With the advances in technology we’ve achieved recently, together with tiered programming and audience segmentation, this percentage ought to rise dramatically.
Data and customer behaviour can be tracked and used to create tailored loyalty programme offerings. Your company may develop tiered programmes with real-time segmentation and lookalike audiences, and customers will pay for them.
There are other segments of the audience than the ones mentioned above. However, each group you form must also have experiences and strategies that are appropriate for the target audience. Working with no more than four groups is typically the safest option. Each tier can be efficiently targeted based on client lifetime value (CLTV).
Pressing the Right Buttons to Recognize Characteristics
The essential indicators for which group to focus are provided to your firm by tracking consumer data once your segments have been determined. The identical offers shouldn’t be sent to all of your clients because each segment will yield a different return on investment. By allowing you to give your top spenders exclusive deals, you may segment your clients depending on their purchase habits. And in contrast, this gives you the opportunity to target your high-risk consumers with retention-boosting tactics. Customers will feel valued and appreciated when they realise that their offers are tailored to their purchasing habits rather than being just another automated email.
Giving your top tier loyalty rewards is advantageous in many ways, but if you want to advance levels, it’s just as crucial to encourage your second tier to keep making purchases. Since they are your most devoted clients, they will receive the most of the spending from your loyalty programme budget. Instead of discounts, provide customers experiences like first access to new products or unexpected benefits.
Observe the trends and habits of your clients. You have the opportunity to launch a flash sale or a new product on a Thursday if customers are using rewards more regularly and traffic is up on that day. Don’t let an opportunity pass you by; set up an analytics overview. Utilizing products like Mapp’s insight-led Customer Engagement, you can be sure that your datasets are organized, and your offers are personalized.
Bringing Everything Together
Your company doesn’t have to handle developing segmented consumers and discovering the ideal loyalty programme methods on its own. You have the means at your disposal to create the ideal segmented and tier-based loyalty programme for your business. Your business may lower churn and increase retention through your loyalty programme with specialised audiences by putting an emotional focus on your clients.
Contact the specialists at Antavo by scheduling a demo or submitting an RFP if you’re curious to learn more about loyalty programmes and loyalty programme technology.