Initiatives to get your exclusive business are a dime a dozen: Everywhere you look, companies and retailers offer you bonus miles, points, exclusive deals and club memberships. But businesses know that a customer’s wants evolve and so must their programs to keep you interested in investing your time and money with them. Here’s a look at what the experts call some of the latest trends in loyalty and rewards, and what the successful ones should have.
Reward programs, retail or otherwise, do huge business in Canada, so much so that setting up shop in this country without one is next to unthinkable. The Hudson’s Bay Company, for example, offers its HBC Rewards program through all its outlets: The Bay, Zellers and Home Outfitters. It also offers its program through Esso gas stations.
Kelly Hlavinka, managing partner of Colloquy, a Cincinnati, Ohio-based loyalty marketing researcher, says 9 out of 10 Canadians participate in some manner of rewards program (as opposed to 5 out of 10 in the U.S.).
“Canadian customers are clearly looking for more value when they spend their money,” she says. “More consumers are expecting loyalty and reward programs from the companies with which they do business.”
Accessibility is of key importance, says Neil Everett, senior vice-president and chief marketing officer of Air Miles. For a loyalty program to succeed, customers must be able to exchange their points for rewards fairly quickly after signing up, and there has to be a wide range of redeemable items for different consumers. Boomers, for example, are trading in for flights and cruises, families exchange for amusement park passes, and younger collectors (under 30) are choosing technology and short trips.
“It’s starting with identifying your customer and the kind of loyalty you’re trying to create, and tied to that is your business objective,” said Everett. “You have to create the right incentive and aspirations and make it attainable.”
Hlavinka forecasts a bright future for reward programs. More of them will be geared towards women (otherwise known as the primary financial decision-maker in consumer data collecting circles) and technological items such as mobile phones will be more in demand. Experience rewards such as trips will continue to be among the most popular, resulting in a wider range of travel packages being offered.
Soothsaying aside, she notes that a good rewards program, at its heart, should be an accurate reflection of how its customers spend their money.
“It’s really a direct result of what customers are engaging in, and the different items they’re redeeming their points for,” she says.
Accessibility key aspect of successful programs
Initiatives to get your exclusive business are a dime a dozen:Everywhere you look, companies and retailers offer you bonus miles,points, exclusive deals and club memberships.