Retailers can increase their income thanks to the loyalty of their customers. Because this aspect is crucial, we made this article about the three biggest issues with loyalty programs to help you with your marketing efforts. You could argue that today’s most successful loyalty programs directly result from reliable, data-driven insights implemented by the most successful organizations.
Loyalty programs are a top priority for retailers like you because they help encourage repeat purchases from your most valuable customers, encourage exploration of your brand among potential new consumers, and boost awareness of your business through positive customer reviews. This means that loyalty programs directly contribute to a company’s success.
Your loyalty program needs a solid foundation of accurate client information more than ever before. Retailers struggle to stay up with the competition thanks to changing consumer purchasing behaviors and the 24/7 at-customer-leisure shopping cycle.
The ideal situation is achieved when stores have access to reliable, timely customer data that they can incorporate into loyalty programs. Correct customer addresses, emails, and phone numbers that have been “enriched” with consumer qualities such as purchase propensity are beneficial for targeting communications. But one of the biggest obstacles you and other merchants have is gathering reliable data.
Even though customer loyalty programs can boost sales, many stores have difficulty managing the data aspect of their business. Where do most loyalty programs go wrong? What are the three most significant roadblocks to building a loyal customer base that will last? The common thread connecting them is, of course, information. Click here for more information on mail quality and tools.
The Three Biggest Problems With Loyalty Programs
1. There are too many data collection methods.
Many points of contact between a store and its customers might serve as data-collecting channels. Consider your business’s many touchpoints with its clients, such as its website, point of sale, call center, mobile apps, etc. Plus, if you have a loyalty program, you even have another way to get client information.
There could be a drop in data quality, confusion amongst customer sources, and a bloated data team if there are too many ways to get information. According to a 2020 Global data management research, 90% of merchants identify problems stemming from low-quality data.
Avoid reducing the number of channels you collect because, in theory, more data is better. However, you must not overlook quality. Consider selecting a master data handler and standardizing your data-gathering strategy across divisions to deal with the problem of different data sources. Your data handler can operate as your single point of contact throughout the data gathering process, monitoring activities to guarantee high data integrity standards are maintained as attention is paid to the big picture.
2. Bad contact information
Getting customers to sign up for your loyalty program is the first step. Consumers’ propensity to sign up is influenced by several factors, including the complexity of the signup process, the amount of personal information requested, and the length of time it takes to submit that information. If not enough potential customers sign up, getting in touch with them will be more challenging. No amount of signups is helpful if one cannot use the information provided to contact the people who provided it.
An answer is to use a data quality solution. According to the most recent Global data management research, the top three ways in which poor data quality affects retailers are through squandered costs (45%), damaged reliability of analytics (39%), and a negative impact on reputation (35%). Whether you’re looking to adopt a data cleansing tool, such as address or email verification, or employ predictive analytics to enhance the customer experience, taking charge of your data will give you timely, actionable insights.
3. Not having a culture that is driven by data
The number of data quality solutions implemented is inversely proportional to the amount of money a company makes. Neglecting to prioritize data quality can have far-reaching effects on your company, including losing customers, loyalty, and income.
The solution is for businesses to put more emphasis on data quality. A sound data foundation is essential for loyalty programs, but what does that look like?
- Cleaning up the information you already have.
- Cleaning up duplicate data and merging similar records.
- Checking the new data for accuracy before adding it to customer relationship management or other systems.
Having access to trustworthy, error-free data allows you to gain valuable insights into your customers and prospects, allowing you to provide them with a better experience. Make sure your data quality activities are on point when loyalty programs are the key to boosting revenue, client retention, and lifetime value.
