Using tailored customer loyalty program communications allows many businesses to establish a personal, one-to-one connection with your program participants, which is essential for establishing a unique communication style.
Your brand should distinguish your communication style away from sending endless communications that may apply to the individual and relentless notifications of potentially relevant updates. The program needs to understand the member’s place in the program based on their engagement and success measure to date.
This level of understanding means your program will need to optimise interactions by varying the communication triggers, messaging, and relevance of each piece to the participant. We gain these insights through our Engagement Loyalty Model (ELM), which uses data-driven analytics and weighted metrics of customer loyalty program interactions to group customers in loyalty-aligned cohorts.
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We build these analytics on factors such as earn rates, redemptions, and internal program engagement, which allows us to effectively segment customers and create tailored engagement campaigns with offers and messaging that speak directly to individual customers within a cohort to provide bespoke, targeted messaging—even sometimes being able to connect one-to-one.
Understanding your program’s cohorts can allow relevant and tactical communications that recognise the individual and change the customer’s behaviour, motivating them to manage better the pain point your program is designed to operate.
Customer Loyalty Program Communications Within Targeted Engagement Campaigns
The level of segmentation provided by ELM allows us to take real action within a customer loyalty program based on outcomes and the participants’ behaviour and actions rather than generalising demographics based on the business type.
Your segmentation can provide a level of understanding of where each customer sits within the program lifecycle, letting us build campaigns to maximise engagement with targeted messaging that can:
• more flexibility in the communication types and messages we include
• the ability to adapt messages to changes in the market, new products or services, and recognition.
By tailoring these communications and messaging, you can effectively direct a member’s change in cohort and position within your program’s lifecycle. This potential for enhancing sales underlines the importance of providing relevant messaging to their status—ensure you avoid messages that are either too high or too low, as this lack of understanding may alienate the individual.
Consider the lifespan and amount of interactions that your customer has within your customer loyalty program to be equally important. As these figures increase, so do the insights gained through ELM and what they reveal about your customers. You can then understand that the actions required to meet program and customer objectives will become apparent.
Examples of Cohort Customer Loyalty Program Communications
Within ELM, we have broken each loyalty type down into six segments, or cohorts, that develop over time within any customer loyalty program. Three of those six have considerable potential to shape the success of your program: “Savers,” “Regular Earners,” and “On The Way Out.”
Tailored communications and messaging within these groups can bolster engagement through increased sales or redemptions and can identify the position each customer takes within your program. This allows your brand to recognise your top performers, motivating those in lower tiers.
Executing these segmented communications can ensure the longevity of your customer loyalty program and positively impact the customer as you communicate with them.
1. Savers
As the name suggests, these participants within your program will bank points. This could be due to two potential reasons—they may be saving for a high-value reward or may be disengaged and accumulating points without frequent participation within the program itself.
Despite how different these positions may be perceived, they share similar outcomes. Your campaigns must encourage redemption from these customers and find ways to celebrate their success, demonstrating the trophy value their efforts within the program can achieve.
Reward goals and wishlists within the program can achieve personalisation by highlighting that they can now redeem the reward or pointing out what is required to achieve redemption. These features allow your program to capitalise on its drive for success and can reinforce the complete program offer and the benefits to the customer. Your program’s value and success measures are kept front-of-mind, highlighting its importance.
The ‘Savers’ cohort usually comprises your top customers based on spending. Additional messaging for this group can include short-term offers, discounts, or promotions that drive them to engage and earn.
2. Regular Earners
Your ‘Active Earners’ are most likely to redeem rewards regularly and earn points consistently, making them valuable to the success of your program. Your brand can depend on these customers to continue engaging with your customer loyalty program.
Despite continuous engagement, their total point balance may place them in a mid-tier compared with other members due to their frequent redemptions. It’s essential to have the parameters in place to separate them from these communications, as their balance is not due to disengagement but instead due to their earnings rates.
We often refer to these customers as ‘growers’, as they have the highest opportunity value for earning points, which goes together with potential sales increases. Through effective management, your program can direct these customers to make higher annual purchases, financially driving them towards a higher customer tier.
Your program can engage these customers with campaigns promoting success and potential earnings. These campaigns can be customised by including personalised rewards or bonus point offers that can encourage continued loyalty. The higher they can achieve within the program, the better your business relationship can be long-term.
3. On the Way Out
It’s important to note that not all customers and program members will always be satisfied with the program. Therefore, it is essential to identify these customers, as this can help the program’s development and the internal sales team at the same time.
Participants within the ‘On the Way Out’ group will likely reduce their spending and earn fewer points, which can be due to a multitude of factors. They may be switching to a competitor or have already redeemed all their points and lack the drive to continue engaging with the program.
Your brand can consider this group safe, as you already have a professional relationship with this customer, which carries a considerable amount in B2B sales. Utilise campaigns highlighting the program’s benefits to them and provide exclusive offers to help them build points back, influencing their increased participation. You may spend some of your budget to dispense the additional bonus points, but it’s a small price to pay to retain these customers.
Winning back program members comes down to providing value and demonstrating your understanding of their needs. Personalised customer loyalty program communications addressing them, and their current situation, will allow them to recognise you understand and care about the relationship as a customer, not just a participant.
Speaking to the customer directly through your customer loyalty program communications rather than as a faceless brand can allow you to solve nearly any issue your business faces, so remember the power of insights that a customer loyalty program can provide.