Retail Loyalty Programs Need TLC
It's amazing to me that in this economy, where supply outnumbers demand and customers are very choosy about where they spend money, that many retailers still look to short-term discounts to woo customers. Business experts everywhere emphasize the importance of customer retention and loyalty, but retailers, even those with loyalty programs, need to rethink their loyalty strategy.
In today's issue of 1to1 Weekly, we spotlight a new Aberdeen report, Cutting Edge Customer Loyalty: Retail Best Practices for Acquiring, Retaining, and Re-engaging Customers, which surveyed 165 retail companies about their loyalty efforts.
According to the research, 90 percent of the Best-in-Class retailers indicate at least "some level of success to very successful results" from their loyalty programs, compared to less than a third of Average and Laggard retailers. The disparity exists because the Best-in-Class firms create better, more customized and personalized promotions, through the use of customer data mining and analytics, than do Average and Laggard firms, the report states.
Aberdeen researcher Sahir Anand says that companies are lacking the strategy to deploy advanced analytics, measure the success of their loyalty program, and integrate them among different customer channels. There is much to be done if retailers are really serious about building loyal relationships with customers.
What do you think? As a consumer, is there a particular retailer that goes the extra mile to build loyalty? Or do you have any horror stories to share?
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