How mobile can make loyalty more cost effective

In 2012 we saw a big boost in the amount of consumers adopting an omnichannel approach towards retail. Marketers began to take on this strategy and keep up with the speed at which a customer would see a marketing or advertising campaign and search for the product or service to find out more information. A marketer’s goal was to continue the journey of the customer from search to closing the sale and ultimately increasing revenue.

But what was happening once these customers made their sale and logged off? Was there retention? Was there an incentive provided to come back? And what was happening to the loyalty programs designed for the bricks and mortar side of the business?

Loyalty programs are designed to retain existing customers and give them incentive to come back to purchase more products or services. But with digital and ecommerce becoming stronger and stronger physical loyalty programs such as loyalty cards, can be adapted to not only act as a retention tool, incentivising customers to purchase more products, more often, but also leverage their goodwill to target and acquire new customers.

Mobile loyalty allows those customers who may dabble between shopping online and shopping in store to have on hand (or in pocket) a loyalty program they can use wherever they wish to shop.

But for marketers looking for new, more cost-effective ways to retain existing customers mobile is really the way to go. For those who are still a bit suspicious of mobile marketing tactics or for those who just need a few more reasons why investing is the best option; here are a few tips on how mobile can make loyalty more cost effective.

Say goodbye to loyalty card production costs

Traditionally, a loyalty program comes with a little plastic or cardboard card that gets hole punched or swiped and accrues points or counts down the amount of purchases left before the customer can obtain their gift or incentive.

These cards can cost anything from several cents to several dollars to be created which, over time, can equal to thousands or maybe even millions of dollars.

The move to mobile loyalty can mean saying goodbye to those production costs as a loyalty app (when using appropriate technologies) can include the barcode for swiping plus many other features a plain old loyalty card can’t hold.

Of course there is a development fee for creating a native app and these costs can vary depending on the features wanted. However the total costs for creating a native app will still be lower than the overall production costs for creating a physical loyalty card. This could potentially mean the yearly budget placed towards loyalty would below leaving more budgets to play with.

Not just a barcode

Of course if a barcode is the only feature that is needed on the app then that’s all it needs to be – the fact that a person would be more willing to leave home without their wallet than without their phone is still a big reason to transfer a physical loyalty program into a mobile one.

However, the advantage of having a mobile loyalty app is that the app can also engage and communicate with your customers using mobile strategies such as push notifications, SMS marketing, email, mobile payments and a direct link to the online store.

These apps can have features such as a built in QR code reader or the ability to send through push notifications when the GPS system picks up that the customers location is close to a shop. These apps also build on your mobile database and opens up another avenue for SMS marketing.

These features build on the ROI of the loyalty program by adding to the customer’s journey and targeting them at the precise moments which can lead them from search to purchase. The loyalty program becomes so much more than a card that accrues points – it becomes a way for marketers and retailers to communicate, engage and incentivise their customers; leading to higher customer retention.

Bringing in a direct link to m-commerce

For consumers on the go, purchasing products and services on mobile just makes sense. With a loyalty app this can all be bought into one by including payment options such as PayPal in the app.

This provides an easy hassle free experience at the checkout and allows the user to make the purchase quickly without having to put their details or loyalty number into the system as the app will already have all of these. It’s also a great incentive to use coupons and deals sent through via push notifications or SMS as the user can simply open the app and begin the sales process.

Essentially a mobile loyalty program is all about making the customer journey from research to purchase a smoother, simpler and more fun process. It’s also about increasing customer loyalty and then transferring that loyalty into revenue.

In the end, if well executed, mobile loyalty will lower production costs and helps to increase customer retention and revenue.


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Shaun Dobbin
BY Shaun Dobbin ON 19 February 2013
Chief executive, Gomeeki, the Australian mobile service provider for mobile marketing solutions. With a blue-chip client base, Gomeeki has been a pioneer in the Australian mobile sector.