Flexibility is No. 1The most important attribute to look for when choosing a loyalty partner is flexibility. Customization is a leading driver of customer engagement, which means your partner must be able to support customer segmentation – from entry-level to your most profitable, signature customers – as you see best. Flexible vendors can support your strategy in three areas:
Earning points.For instance, the most profitable customers could be offered triple points on Black Friday while entry-level customers receive double points.
Redemption.The days of cookie-cutter redemption offers and long waits to redeem points are long gone. The growing list of new options – redeem points in real time at the point of sale, redeem for digital downloads, tunes, and even stocks – enable issuers to access a wider variety of offers. A flexible vendor can vary these offerings according to the customer segment.
Communication.More profitable customers can receive more effective, higher cost communications, while less expensive communications, such as email, are directed to other customer segments.
Being Nimble is a VirtueImmediacy is today’s expectation that makes being nimble a requirement to remain competitive. Nimble loyalty vendors can execute on the fly in the following areas:
Earning points.Bank ABC plans a triple-point Black Friday promotion, but at the last moment discovers that Bank DEF across the street is planning a five-times-points promotion for using its card at comparable retailers. A nimble loyalty vendor could immediately adjust Bank ABC’s promotion to remain competitive.
Redemption.Bank ABC may initially decide that it doesn’t want to include gift cards in its assortment of redemption options. At the last moment, it discovers that Bank DEF is expanding its offer to include gift cards. Bank ABC needs a nimble partner to help it quickly follow suit.
Communication.The timetable for crafting and sending out communications to consumers has been reduced from weeks to days – sometimes even hours. Your partner must be able to adapt immediately.
Is a single loyalty vendor the answer?Some card issuers use multiple vendors – one provides the scoring platform to calculate loyalty points, cashback, and currency, another provides fulfillment and a third provides marketing support. The problem is that coordinating activities among multiple vendors requires an internal team to maintain consistency, which is a luxury that many entities can’t afford. Suppose Bank ABC offers its best customers triple points on Black Friday for using its credit card at Retailer XYZ. The loyalty vendor sets the promotion on the system, but a different vendor communicates the message. The staff at Bank ABC bears the burden of ensuring that its two vendors are in sync and remain in sync even if changes occur. A single provider that can handle all the tasks – scoring, fulfillment, and marketing – eases the load on Bank ABC’s staff and lowers the risk of miscommunication. Ask yourself:
- Does my current provider have the flexibility I need to support my loyalty strategy?
- Does my current provider offer nimble execution that enables me to effectively compete in my market?
- Does my current provider possess the requisite scale and ability to provide the scoring platform, fulfillment, and marketing communications, which can reduce my internal cost and risk in executing effective loyalty programs?