According recognition and conferring rewards in the form of promotions, discounts and deals is not just beneficial, it is necessary as the internet marketplace is constantly evolving. It costs businesses 5 to 10 times more to acquire new customers than getting repeat customers to purchase products or services. Present customers, on average, spend more than new clients to the tune of 67 percent. Given these statistics, choices on the internet have necessitated the use of customer loyalty programs rather than ending them.
Apart from getting customers to repeat a purchase, loyalty programs also help businesses understand customers to better meet requirements in the future. At the heart of customer loyalty programs is the aim to help a business identify customers, unearth needs and address these. Customers in the competitive internet marketplace want rewards. But the benefits of customer loyalty programs don’t stop at getting customers in. It also focuses on leveraging technologies, so the customer loyalty programs can enable your business to collect detailed customer data.
- How Internet Technology Has Changed Loyalty Programs
Customer loyalty programs date back to earlier times, but due to the advent of internet technology, the programs have evolved and changed the way customers interact with your business. Loyalty programs have expanded to all areas of B2B and B2C marketing. Even mass marketers and online businesses have adopted the loyalty concept as it proves valuable in offering benefits for a loyal customer.
Retailers use big data and technology through extension in meaningful ways to the staff to impact customer experiences. Customer engagement is gradually becoming increasingly important. Cloud computing and mobile devices enable the same data to be delivered to empower shoppers and employees alike. Data shared across multichannel retailers permits staff in store to learn from user experiences and shape services accordingly.
- The Role of Internet Technology in Marketing
The internet enables different kinds of shopping experiences to take place and brings out contextual relevance of the knowledge brands and retailers collect about customers. The aim of the loyalty programs is to enrich customer experiences and take away the pain points in the retail experience. While customer retention or loyalty programs have changed as a result of the emergence of wide range of choices on the internet marketplace, they have certainly not ended. Technology and the internet are, in fact, even opening up new ways of identifying customers, what and where purchases are made, how marketers seek to make customer identification a seamless process and part of the shopping experience.
Customers can extract more value out of programs as a result of the emergence of technologies such as social media, check-in services, targeted communications and mobile proximity as well as deals of the day impacting the loyalty landscape. Customer loyalty programs are no longer concentrated only on points. Data-centric marketing communication causes changes in customer behaviour that are measurable. A new breed of loyalty initiatives will make it easier to locate, engage and reward customers for their loyalty and continued support.
Internet technologies magnify the marketing decision making process and their outcomes. Customers remain loyal for brands that meet needs, regardless of new information technologies on know-how about products and services. With a wider number of choices, some experts question if brand loyalty can exist.
It is precisely this phenomenon that makes it imperative to engage and interest customers. Only if there is weakness of offerings can the internet prove to be detrimental to customer loyalty. But others hold that there is no either-or choice. While some will need brand references, others will search for new features. New information delivered by internet technologies makes consumers more alert. Additionally, reviews and word-of-mouth marketing are growing as a result of the internet marketplace.
Marketers have nothing to fear from the internet, if they are focusing on strengthening brands. Internet technology is not a threat to customer loyalty. This is because loyalty is earned by meeting expectations and exceeding them. New information technology could exact a massive toll on marketers not able to raise their performance and their standards. Marketers who have a great story to tell will thrive on the internet. The internet technologies can prove to be results magnifiers in either direction. The potential negative impact of internet on customer loyalty initiatives is overstated.
- Customer Loyalty in a Digital Era
The internet has changed the way business is done and impacted loyalty marketing too. While many hold that amount of information about products and services is so massive that consumers will be requiring direction in making a purchase decision leading to greater brand loyalty, there are other views as well. In direct contradistinction, the other perspective holds that internet technologies such as search and feedback mechanisms are booming as against information overload. So internet shoppers will have the upper hand in the battle for information. But customer loyalty is all about using this feedback to improve your product/service and retention rates.
The internet, it can be argued, may enable younger customers to try new products and services and lead to loyalty switches. This calls a good portion of marketing beliefs and expenditure regarding brand building and customer lifetime value into question. A better informed customer, however, need not translate into a less loyal customer. Employee and customer loyalty are an increasingly important determinant of business growth and profits in the internet age. Big data may seem too overwhelming or search and valuation devices may make consumers smarter. Either which way, brands have to work on customer loyalty.
The internet and the massive availability of real estate online have made location differentiation and customer loyalty initiatives both important. Loyalty programs offer retailers a chance to stand out from a crowd and attain a distinctive sense of value. Technology is an important factor in reward programs as retailers now have a wealth of ways to collect, store, slice and dice client data. The more information one gets, the better one can deal with it and provide services for customers.
The most important component in customer loyalty programs still remains customer engagement. Retailers need to question how to create a synergistic alliance with consumers instead of pulling one over them. If the customer loyalty program is a means of ambushing clients, then definitely the internet has ended the reign of such loyalty initiatives. But if the customer loyalty program is a genuine effort to make products and services interesting and engage the customer, the growth of the internet can only help!