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Keeping your loyalty programs fit for the digital age

Published August 12, 2022

We live in an increasingly digital age, where almost anything can be done over the internet. Many businesses have embraced digital transformation, which summarizes an organization’s process of moving workflows and transactions online. 

While digital transformation can be a challenge, especially for small business marketers, embracing it helps you set up best practices and goals related to customer retention and customer loyalty programs.

What customers want out of a loyalty program in the digital age

Today’s consumers want to interact with your grocery brand online, and preferably from a mobile device. This is an example of how the digital age should impact your approach to your loyalty programs and digital marketing.

Customer loyalty programs have been around for a while. They involve points programs, loyalty cards, cash-back opportunities, reward earning, or a tiered loyalty program, where loyal supporters earn rewards just for making repeat purchases.

But modern preferences have changed how brands create successful loyalty programs to facilitate brand loyalty. Many companies now offer apps. So, people can make purchases and monitor their progress from their smartphones. To add, customers want to have a more personalized customer experience using these digital tools. So, customer loyalty programs need to prioritize the latest technologies that engage and excite existing customers. 

A major concern for today’s consumers is the rising inflation rate, currently sitting at 9%. To make sure your loyalty program meets the needs of your customers with this reality, you should consider putting a greater focus on personalized messages that directly address people’s concerns. 

Show customers why your products are worth their price, which is a bigger concern for them when inflation is so high. Try to offer more unique incentives in your loyalty programs. So, you would stand out from other grocery retailers, too.

Reinventing loyalty programs for the digital age

Personalization is a big driver of the modern loyalty program. Consumers want to feel like brands understand them on an individual level. A consumer survey from Epsilon found that 80% of customers are more likely to support a company with their business, if it offers a personalized customer experience, and 90% said they find personalization appealing.

So, not only do people want discounts and perks through a customer loyalty program, but they want those benefits to be suited to their needs. 

You need to be able to use customer data to send out more personal messaging to your audiences. Get to know their behaviors online, segment your customers and send out messaging specific to those different groups. 

Make your loyalty program content speak directly to the individual. Show them how you can solve their problems and give them rewards that they actually want.

Younger generations, like Generation Z, are now dictating where brands should be trying to connect with people. They’re driving the digital age with the integration of social media and mobile transactions in everyday life. They have never known life without the internet or social media, and they demand a strong digital presence from the brands they support.

Knowing what today’s digital-forward consumers care about will help you integrate the right technologies into your loyalty program. About a third of U.S. consumers say they prefer brands that provide a multi-sensory customer experience, integrating new innovations like augmented or virtual reality.

How to design an effective loyalty program for the digital age

As a grocery retailer, you need to consider priorities for digital consumers while recognizing that 75% of consumers favor companies that offer rewards. The success of your customer loyalty program depends on how effectively you can provide perks and experiences that cater to the modern buyer. 

Consumers see a lot of content from brands. A lot. In the digital age, they’re more discerning about what they believe and who they support. They want to have more meaningful connections with a grocery company before they decide to shop there.

So, how do you establish these deeper connections to influence customer behavior? Try these strategies:

  • Make them feel special: Ensure stellar customer service and make people feel like your services are just for them. Show plenty of appreciation when they support you. Give them a reward here and there.
  • Anticipate what they need: A great trick that keeps people loyal is knowing what they need or want, even before they themselves realize. 
  • Gather feedback: A great way to make customers feel seen and heard by you is to actually ask them about how they’re feeling. 77% of consumers report favoring brands that ask for and accept customer feedback.

A loyal customer will feel connected to the retailers they want to do business with. Focus on harnessing that connection to influence how they act.

Mobility is also key to success. More people than ever before depend on smartphones and tablets to conduct a range of daily activities and interact with others. Thus, you, need to integrate mobile loyalty marketing into your loyalty strategy. Make sure your interface is compatible with a mobile audience and keep the content light and to the point for easy reading.

Related: Personalization can be the key to boosting your loyalty program

How can you be sure which type of loyalty program is the key for your brand?

Metrics should be driving your customer loyalty program decisions. With the right data, you’ll be able to understand even more about your audiences and you’ll know exactly what’s working and what isn’t with your loyalty program or rewards program.

A few important retailer metrics include these key performance indicators (KPIs):

  • Customer Satisfaction Score (CSAT): The CSAT tells you if customers’ expectations have been met or exceeded with your products.
  • Net Promoter Score (NPS): This score tells you how customers feel about your brand by asking them how likely they are to recommend you to others.
  • Participation Rate: Track how many of your customers sign up for your loyalty program with this metric.
  • Customer Retention Rate (CRR): One of the goals of your loyalty program should be to retain more customers. The CRR tells you how many customers have bought from you before.

Using these metrics, you can figure out current sentiment about your brand and whether you’re likely to have strong brand promoters and loyal customers.

When the name of the game is meaningful connections, choose a partner  that can help with your digital transformation.

Loyalty points are only the tip of the iceberg.

See 6 little-known factors keeping today's consumers loyal.

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