Close to 60 percent of revenue-generation from loyalty program members are a reason why retailers prize customer retention strategies, as per BCG. For conventional retailers and big department stores, customer loyalty programs offers valuable data used for personalising offers and ensuring program perks are desirable for clients. Perceptions regarding loyalty programs can be impacted to a large extent by consumer perspectives. With smartphones becoming the device of choice for accessing customer deals, apps are emerging as the most prominent feature of any client loyalty program, with additional members likely to use smartphone apps rather than old-fashioned plastic cards or coupons.

Loyalty cards and apps satisfy loyal clients and attract new ones. With rewards focusing on coupon offers, regular savings and exclusive personalised user experiences, client loyalty programs provide perks and immense value to members and brands alike.

  • Understanding Customer Needs

In numerous countries, patterns of consumption have undergone a change in recent times. Disruptive business models such as online retailers and discounters have enabled established retailers for investing more towards comprehending client needs and requirements. Customer loyalty programs provide valuable and important customer data to personalise offers and ensure program rewards are critical for clients.

Perceptions associated with loyalty programs differ across clients in various regions across economic and cultural lines. Across UK, the department stores are offering price as a competitive differentiator rather than loyalty program rewards. For the US, members in loyalty programs continue to grow in number, but real engagement is low. In parts of the EU, like German and Spanish nations, consumers have held concerns regarding data privacy leading to the inhibition of participation in consumer loyalty programs.

An average household in North America holds membership in twenty-nine loyalty programs and only use 12 of these, as per a report by Colloquy. Specialty retailers are one of the biggest retail sub-sectors as far as membership goes. Following department stores, grocery shops were the fourth largest sub-sector for loyalty memberships. So, customer loyalty initiatives in North America are associated primarily with department stores. Whether it’s Costco or Sam’s Club, loyalty programs offer benefits for retailers and customers. Customers are rewarded with vouchers, discounts plus exclusivity when programs are joined. Retailers also access analytics and shopping data.

  • Apps For Bridging Loyalty Gaps

Smartphone apps have become a critical part of client loyalty programs. Many members are likelier to use smartphones. Apps permit retailers to communicate and engage with customers effectively. Apps can also be used for notifying clients for unclaimed loyalty rewards or pushing personalised, geo-targeted offers to clients based on earlier buying history. Consider US department store Walmart, which used its Savings Catcher application for combining price plus loyalty factors in the absence of the need for customers to check out numerous stores to locate the best deal. Walmart has also made it easier to claim points without facing any hassles. Customers can scan receipts and if products are cheaper elsewhere, the system refunds the amount on gift cards automatically.

Smartphone coupons are used by Asian players such as Alipay Wallet or WeChat Wallet.

For the US, mobile devices are used more often for loyalty programs, like 7-11’s 7Rewards as against coupons. Europeans show smartphone activity levels for loyalty programs and coupons. As mobile or smartphone payments expand internationally, retailers invest in app-functionalities that generate loyalty and sales.

Colloquy indicates smartphone apps are sometimes, even the essential factor for determining continued program membership. Smartphone apps are also complemented by factors like programs, which are simple to comprehend and provide rewards that are relevant.

  • Sustaining Cost Efficiency And Offering Discounts

Customer loyalty programs are flourishing, even in nations where price sensitivity and competition push individuals towards low price stores. Retailers worldwide strive to invest in retention or loyalty programs offering more than discount shops and e-commerce retailers. Programs also potentially deliver valuable customer insights to retailers. Sustained interest and focus on loyalty programs is about bringing the right analytics for the most impactful customer retention strategies.

For department store shoppers, price and availability drive consumer loyalty. For example, the apparel stores offer quality plus fit to retain customers. For each store, the quality of the service, value for cash and product consistency are among factors generating customer loyalty. Such consumer loyalty programs are a panacea, boosting genuine loyalty through core offerings to be the objective of each retailer. Customer loyalty initiatives are marketing tools used by some of the largest department stores out there.

  • Structured Marketing Effort

Customer loyalty programs from Pathwwway Limited are long-term, structured marketing efforts, which offer incentives to repeat clients who demonstrate buying behaviour that is loyal. Successful programs motivating customers in the target audience to return more quickly, making frequent sales and shunning competitors. For retailing, programs reward loyal clients with special offers, points, rebates, freebies or discounts. Customer retention embodies the chief goal of department-store customer loyalty initiatives.

  • Benefits of Loyal Customers

Customer loyalty freebies can help retailers win a larger wallet share and mindshare. Client referrals are the biggest advantage of a consumer loyalty program. Client research indicates close to 73% of customer loyalty or VIP club members are likely to make referrals. Well-implemented client loyalty programs impact client satisfaction directly. Rewards offer value to customers, creating a sense of acknowledgement and experience.

Repeat customers generate a steady traffic flow, creating a steady income stream. Larger consumer loyalty programs offer more predictable volume of retail sales. Customers joining loyalty programs earn discounts and receive freebies. For active users of a consumer loyalty program, the system needs to maximise rewards. Here’s how different department stores achieve this.

A study by Bond found that 73 per cent of loyalty program memberships are likelier to make brand recommendations. Vibes found that 77 per cent of smartphone or mobile device users are more loyal for companies that reward points, exclusive content, birthday surprises, and more through their device.


Retail loyalty programs are essentially programs that seek to reward individuals for customers making frequent purchases. The Loyalty Report in 2017 found a majority of the customers say loyalty programs are most crucial for doing business with brands. Close to 66% modify their expenditure to maximise loyalty benefits. From simple points to tiered systems, customer loyalty programs enable your business to grow from strength to strength. Thus, big department stores can make a big difference to their bottom lines by opting for consumer loyalty programs.

Posted by IT Pathwwway