Is it time for retailers to up their ‘loyalty and engagement’ game?

January 7, 2021 | By RetailME Bureau

The loyalty test – that was one thing that retailers got to put their customers through this year where they got an opportunity to understand how many of their existing customers were actually loyal to them and how they could up their reward game. The real pressure, however, was on retailers.

Conventionally, data had been used to – quite simply put – make money. However with Covid-19, retailers pivoted that mindset to ensure that they were using the precious data they now have access to, to improve customer experience and build a loyal army of satisfied customers.

“We have a daily Merchant Processing Solutions (MPS) program that runs across all of our 100 locations where we get daily feedback from our customers and what they think of our experiences. This helps us talk to our customers and tailor any new offers we are launching. During Covid-19, we launched private cinema, drive-ins and we asked our customers (before launching) what they thought about this and how much they would pay”, said Cameron Mitchell, CEO of Majid Al Futtaim Leisure & Entertainment and Cinemas.

They applied the same with their F&B concepts, where they would invite their customers to try the menu and give feedback before launching so they could tailor the offer. “Previously, we had to react after a month or two of receiving the feedback, now we are very nimble because of our access to data. Data used to be perceived as being a way of getting more money from a customer, now it’s a way to serve a customer better by ensuring you know and pre-empt what the customer wants before they know they actually want it and in return you are rewarded with loyalties”, he added.

Loyalty programs have evolved massively this year in their approach and implementation. Most retail businesses today are multichannel and a lot of them are multifaceted in their offerings. This allows retailers to fulfill the expectations of their customers across multiple channels and verticals. And the more a customer spends with a retailer, the more loyalty they show, they expect to be rewarded better.

“As I become more and more loyal, you have my data, I need to be rewarded much better as a customer. Unlike before, where people would collect points and then come and convert them, now people tend to go for instant gratification and experiences. This works well for brands that are multifaceted, i.e, have retail, F&B, entertainment offering etc in their portfolio.  So a retail customer who is loyal to you can be rewarded in the F&B segment”, said Kiran Karanki, CEO of Semnox Solutions.

“This is where data makes sense to identify and reward customers and build different tiers to reward customers who move up in these tiers progressively. So you have a 360-degree view of your customer that won’t just allow you to reward high spending customers but also personalize experiences”, he added.

Retailers of every scale approached a more personalized approach this year and tried to build a direct connection and contact with their customers to communicate effectively.

“The idea of constant connectivity was super important to us. We tried to give value to specific customer groups that were probably suffering more than others. So we started creating a targeted campaign to try and add value to people at a time that was difficult”, said Ian Ohan, Founder and Chief Executive of KRUSH Brands.

“We accelerated customer acquisition, digital spend and tried to get more value. During Covid, our online order rate went from 54% to 60% as I think there was a migration to brands they trust and they have a direct relationship with”, he said.

Magrudy’s took a similar approach as well. “During Covid, we used our loyalty card system to message our customers to say if you don’t want to come to our stores, phone us and we will find out what you want. Trying to treat your potential customers as individuals despite data, where you want to hear a human voice and people could speak to a human being, so we extended our call centre hours”, said Isobel Abulhoul, Co-founder of Magrudy’s.

“For us the focus of using data has been to deliver high consumer experience. It’s a two-fold thing. On one hand we have the back end operation. For us the challenge in terms of how we record and capture the data is to make sure the consumers get what they ordered and the quality is on point”, said Halima Jumani, Director at Kibsons.

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