I’m a regular visitor to the various mainstream coffee chains that sprawl our high streets. While holding a client meeting at one of these establishments, we got talking about the all singing, all dancing Starbucks Rewards program…
“I can redeem my points anywhere in the world… they even give me a free coffee on my birthday!” I heard rather enthusiastically.
So, I asked, “you must be the biggest Starbucks coffee drinker ever?”. “Nah, I don’t actually like their coffee!”
The conversation struck a cord with me as so many organisations constantly churn out offers and rewards as a way to entice customers back through their doors, when surely a more holistic approach should be taken.
There is certainly a place for the loyalty program lever but for me it needs to be the icing on the cake rather than the cake itself.
It’s simple, if you can get customers to love your brand for what it stands for and what it delivers (earned loyalty), they will only appreciate you more when you give them great offers to spend more time with you (bought loyalty).
So to do this, organisations should consider winning ‘earned’ before ‘bought’ loyalty to be sure to create stickier relationships. Here’s a four step guide to doing just that:
1) Align your brand and customer’s values
As a foundation, your brand purpose must align and resonate with that of your audience and be demonstrated in everything you do.
This will ensure you stay relevant and favoured in the eyes of your customers, leading to an increased emotional connection.
Starbucks didn’t do itself any favours by being embroiled in the tax avoidance issue that goes against one of their core values to ‘connect with transparency, dignity and respect’. After a massive boycott the brand is still recovering and many customers have not returned to its doors.
So to create ‘earned’ loyalty, its important for organisations to reflect on their brand position and determine if it is both clear and truly aligned to their target market.
At the end of it, all other activities flow from delivering the brand promise so it’s important to get right.
2) Propositions must meet and exceed customer requirements
The second stage of ‘earned’ loyalty is to ensure your value proposition spot on. It must align to your customer’s wants and needs, otherwise no matter what else you do, they will not come back for more.
As an example: on a recent visit to Soho, I walked into a very reasonably priced all-you-can-eat buffet. The quality of the food was terribly disappointing to the point I even got resentful paying the reasonably priced price tag.
The real kicker came at the end when I was handed a half-priced voucher for my next visit. Would I ever go back to redeem it? I’ll let you decide.
3) Deliver an exceptional and novel experience
The final stage in the ‘earned’ loyalty category is to deliver an exceptional experience.
If you can meet a consumer’s wants and needs AND deliver it in a place (digital or physical) that is convenient to them AND in a way that is aligned to their tastes, they will make you a regular thing.
I recently had my first experience of immersive theatre at Alice Underground Wonderland (sadly its now finished for the year), where the experience was second to none and exceeded all expectations.
It encapsulated the audience, made you anticipate what was around the next corner and took you into its own world for that space in time.
I ended up taking another set of friends two weeks later and even paid for the premium tickets the next time around. If only brands could replicate these emotions, clearly in their own way.
4) Giving customers that little bit extra
The final step in building loyalty is to generate ‘bought’ loyalty.
This is where you offer incentives, rewards and surprises to encourage repeat purchase and re-visits.
There are some great programs out there, my personal favourite being the Nandos loyalty app. It’s simple and hence effective, as you always know how far away you are from your next free chicken.
But if I didn’t associate with the brand (Cheeky Nandos!), love the food and enjoy the experience, the app would simply not exist on my phone.
So all in all, it’s a simple equation to building stronger customer loyalty: ‘3 to 1’ – Three steps to building ‘earned’ loyalty and one step to building ‘bought’ loyalty. To me, it should be in that order.
You can learn even more about customer experience at our two day Festival of Marketing event in November. Book your ticket today and see how you can create a customer-focused culture.