Going the Distance: Four Ways to Build a Better Customer Loyalty Program for Your Brand

It’s easy enough for a customer to join your loyalty program, especially when you’re offering an incentive such as discounts. All your customer has to do is give out some basic information, and voila! They’re in the fold, a brand new loyalty member with your company. From there, it’s happily ever after. You offer the perks; they stand solidly by you, bringing you their continued business. Simple. Or is it? In reality, just how many of those customers are act ively participating in your loyalty program? Do you know? Sure, loyalty program memberships are on the rise according to market research company eMarketer, having jumped 25 percent in the space of just two years. However, that figure may be a bit misleading. The truth is that, while loyalty program sign-ups may be more numerous, active participation in such programs is actually in decline. At the time of the study, the average US household had memberships in 29 loyalty programs; yet consumers were only active in 12 of those. That’s just 41 percent. And even that meager figure represents a drop of 2 percentage points per year over each of the preceding four years, according to a study by loyalty-marketing research company COLLOQUY.

When discounts just aren’t enough

So what’s a brand to do? How can you make your loyalty program worth your customer’s while—as well as your own? After all, gaining a new loyalty member doesn’t mean much if your customer isn’t actively participating in your program. Consider this: Does your customer loyalty program offer members anything different from what your competitors are offering? Chances are your program includes discounts. That’s a given. And what customer doesn’t appreciate a good discount? But when every other company out there is providing this staple benefit in comparable amounts, it becomes less and less likely that customers will remain loyal to any one particular brand. Frankly, it’s all too easy for customers to get lost in a sea of loyalty member discounts. They’re everywhere. In fact, just under half of internet users perceive that all rewards programs are alike, according to a 2015 eMarketer survey. The key to success, then, is to differentiate your business from the crowd. If you can offer your customers something unique and valuable beyond the usual discount, chances are they’ll be more likely to stick with your brand. Here’s some inspiration from companies who get it.

Virgin: Reward more purchases with more benefits.

That’s not to say you need to get rid of discounts entirely. In fact, nothing could be further from the truth. Customers still love a good discount. The goal is to be creative in terms of the loyalty perks you offer. Take the Virgin Atlantic Flying Club, for example. As part of its loyalty program, the airline allows members to earn miles and tier points. Members are inducted at the Club Red tier, from which they can move up to Club Silver and then Club Gold. Here, it’s not just a discount. It’s status. And people respond to feeling important, elite. Still, even where the rewards themselves are concerned, Virgin is motivating loyalty customers with some pretty attractive offers. At the Club Red tier, members earn flight miles and receive discounts on rental cars, airport parking, hotels and holiday flights. But as members rise in tiers, they get even more. At the Club Silver tier, members earn 50 percent more points on flights, access to expedited check-in, and priority standby seating. And once they reach the top, Club Gold members receive double miles, priority boarding and access to exclusive clubhouses where they can get a drink or a massage before their flight. Now that’s some serious incentive to keep coming back for more. Discounts are still part of the equation – but they are designed with innovation and personal value in mind, elevating them to more than just savings.

Amazon Prime: Pay upfront and become a VIP.

What if your customers only had to pay a one-time upfront fee to get a year’s worth of substantial benefits? It may not sound like the smartest business idea at first glance. But take a closer look. Amazon Prime users pay a nominal $99 a year to gain free, two-day shipping on millions of products with no minimum purchase. And that’s just one benefit of going Prime. It’s true that Amazon loses $1-2 billion a year on Prime. This comes as no surprise given the incredible value the program offers. But get this: Amazon makes up for its losses in markedly higher transaction frequency. Specifically, Prime members spend an average of $1,500 a year on Amazon.com, compared with $625 spent by non-Prime users, a ccording to a 2015 report from Consumer Intelligence Research Partners.

Patagonia: Cater to customer values.

Sometimes, the draw for consumers isn’t saving money or getting a great deal. The eco-friendly outdoor clothing company Patagonia figured this out back in 2011, when it partnered with eBay to launch its Common Threads Initiative: a program that allows customers to resell their used Patagonia clothing via the company’s website. Why is this program important to customers? And how does it benefit Patagonia? The company’s brand embraces environmental and social responsibility, so it was only fitting that they create a platform for essentially recycling old clothing rather than merely throwing it away. The Common Threads Initiative helps Patagonia build a memorable brand and fierce loyalty by offering its customers a cause that aligns with deep personal values. OK, so their customers get to make a little money, too. Everybody wins.

American Airlines: Gamify your loyalty program.

If you’re going to offer your customers a loyalty program, why not make it f un? After all, engagement is key to building a strong relationship with your customer. And what better way to achieve that goal than making a game of it. American Airlines had this very thing in mind when it created its AAdvantage Passport Challenge following its merger with USAirways. The goal: find a new way to engage customers as big changes were underway. Using a custom Facebook application, American Airlines created a virtual passport to increase brand awareness while offering members a chance to earn bonus points. Customers earned these rewards through a variety of game-like activities, from answering trivia questions to tracking travel through a personalized dashboard. In the end, participants earned more than 70 percent more stamps than expected – and the airline saw a ROI of more than 500 percent. The takeaway: people like games.

Stand out from the crowd.

Your approach to your customer loyalty program should align with your overall marketing approach. Effective branding is about standing out, not blending it. Being memorable is key. To this end, keep in mind that loyalty programs are no longer a novelty. That means that yesterday’s strategies won’t work moving forward, so look for ways to rise above the noise, setting yourself apart from the cloying drone of countless other cookie-cutter programs.

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Jumping Into Jumo

New social media platforms seem to crop up and die out (or get bought out) with regularity in this day and age. Whereas the social media map used to consist primarily of MySpace and Facebook (and Friendster if we’re feeling generous), now there's Twitter, YouTube, LinkedIn, Tumblr and Wikipedia, just to name a few. With stories of upstarts like FriendFeed or Lala getting swallowed up by the big guns in the business, it’s a landscape that’s constantly changing.

But the great thing about this open environment is that it isn’t a zero-sum game, as Facebook’s Mark Zuckerburg put it at the Web 2.0 Summit 2010 a couple of weeks ago. As a result, while it’s a noisy scene, the best “artists” making the best “music” rise to the top and get noticed.

The newest kid on the block

Which brings us to Jumo. The latest project from Facebook co-founder Chris Hughes, Jumo is a new attempt to merge the burgeoning movement for social change with the power of social networking itself.

While social change and humanitarian efforts have existed in many formats (with varying degrees of success) on the Web, Jumo’s concept is centered upon fostering a deeper interaction with issues and causes. By focusing on the heart of what drives people to get involved in generous giving and living, Jumo is banking on helping charities and nonprofits connect with potential supporters.

The point of connection is not the “ask,” whereby a nonprofit initiates their relationship with you by requesting a donation. No, Jumo takes a few steps back to first ask, “What is it that you’re passionate about?”. From there, the site connects you with organizations that are working in related fields.

In other words, the relationship that you develop with a charity begins organically with a question of the heart, not a question of the wallet. The end result – financial support – might not be that dissimilar, but the means are profoundly different. Jumo's approach could mean the difference between creating a one-time giver and inspiring a life-long supporter who not only gives but actively recruits others to join the cause through their heartfelt passion.

Why Jumo matters

What does this mean to you as an online citizen?

The Jumo model is important because there are lessons from this approach that apply to us all. Whether you’re running a business or a charity, your interactions – both online and in-person – with your clients are what ultimately drive the machine. You might have the coolest product or the most moving cause in the world, but if you’re not taking care of your customers or donors, you won’t last long.

While on one hand, social media has made it easier to keep people at arms-length behind the safety of a computer screen, it’s also helped to remind us all of what’s important in the social realm: relationships. Without them, you’re sunk.

The nuts and bolts

So how does it all work? It’s quite simple, really.

Step one is signing up for an account, which unsurprisingly starts with a prompt to connect to your Facebook account.

Next you create your profile, with Jumo pulling in your profile picture and basic personal information from Facebook. From there, you review a list of core issues and causes, including poverty, peace and governance and human rights. Each topic leads you further down a path of discovery that ultimately ends in a list of specific organizations that are doing work in the fields that you’ve selected.

Once this process is complete, your Jumo home page will be generated. This page features an aggregated news feed from the projects that you have chosen to follow. You’ll also have a sidebar with suggested projects and issues that might interest you as well as a “Talk” column that reflects updates from all projects, issues and people with whom you’re connected.

If all of this sounds familiar, that’s because it is. The format and terminology will be second nature to anyone who’s already on Facebook and Twitter. That familiarity should be a strength for Jumo moving forward, as it makes the new environment easy to get used to.

It’s also fairly easy to add a new organization or project on Jumo; the key is that you must have a valid Employer Identification Number (EIN) as a 501(c)(3) nonprofit entity. Beyond that, it’s a simple process of plugging in basic information such as your organization's mission and links to your website.

Again, Jumo presumes that your organization has already established a Facebook Page, as it will ask for your Facebook ID number to pull a profile picture in for your new project. From there, it’s up to you to connect with individual users on Jumo, though the platform aids the process by allowing you to select the same topics of interest of as an individual, only this time the selections will help to define what your project is.

A step in the right direction

Only time will tell if Jumo will actually reach the lofty goals that its creators have set forth, but it so far it seems to be off to a promising start.

The interface is easy to navigate, but the site has been plagued by performance issues due to an overwhelming amount of traffic in its first few days of beta launch. The team is working to alleviate those problems, and hopefully, once fully launched, any minor issues will be resolved so that users can get down to the business of changing the world.

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Flex Your Expertise

As one charged with growing a business, there is undoubtedly always one question lingering in your mind: where's my next lead going to come from? Would you believe that sharing just a few minutes of your time and your expertise each day could inject new life into your sales pipeline? The answer is Answers – that is, LinkedIn's Answers forum. Designed as a platform for professionals to exchange expertise, this lesser-known feature of the LinkedIn network can be found under the "More" menu options in the top navigation bar. If you already have a LinkedIn profile, using the Answers forum to attract new leads is easy as 1-2-3:

Step 1: Do your homework.

As with any social media network, it's important to get a feel for the lay of the land before you dive right in, so invest time up-front familiarizing yourself with the LinkedIn Answers forum community. A good place to start is by perusing the leaderboards of top experts in the categories that relate to your business. Click the "see all my answers" links next to these members’ names, and look for commonalities among the answers that were chosen as best. You might even want to test the waters a bit by asking a good question or two so that you can gage the type of responses you receive. Also, if it's been a while since you established your LinkedIn profile, now's the time to dust it off and give it a polish. When you become active on the forums, it's likely that many new people will click through to your profile to qualify your expertise. Make sure you deliver a strong first impression by reviewing each area of your profile to confirm that it is complete and up-to-date. Sharpen the language you use to describe your experience and specialities so that it is precise and powerful. If you're active on Twitter or you have a blog, you can even add applications that will automatically publish your latest tweets and links to your most recent posts on your profile.

Step 2: Turn on your radar.

Once you feel comfortable with the inner workings of the Answers forum, it's time to start looking for opportunities to participate. Questions posted on the forum are divided into categories, from administration and business operations to sustainability and technology, and these broad topics are further subdivided into more specific areas of interest. Don’t try to keep tabs on every question asked. Instead, focus your efforts on the categories that are most closely related to your areas of expertise and where your prospective customers would most likely be active. A great way to streamline this process is by subscribing to the RSS feeds for your chosen categories and setting up a folder in your reader of choice where they can be collected in one location. Rather than having to waste time every day clicking around the forums to browse each category of interest to you, questions will be delivered directly to you in real time. All that's left for you to do is make a quick, efficient scan of your feeds folder once or twice a day to find a few open discussion threads where you can contribute helpful, practical advice.

Step 3: Share your expertise.

When you identify a question that presents an opportunity for you to add something meaningful to the conversation, simply click through to the corresponding discussion forum page, hit the yellow "Answer" button, compose your response and submit. There's no need for a hard-hitting sales pitch. Just talk about what you know with ease and authority. As is true throughout the social media universe, be authentic and allow your personality to shine through in your answer. While you'll want to be conscientious of your spelling and language and maintain a professional demeanor, your response should come across as friendly counsel from a trusted advisor, not an encyclopedia entry. Imagine that the person who asked the question is standing right in front of you, and keep your answer conversational in tone and free of off-putting technical jargon. Be generous with your expertise, and don’t fret about giving away inside secrets. By demonstrating your depth of knowledge and familiarity with the subject at-hand, you'll boost your chances of someone seeking you out to continue the conversation one-on-one. The more personalized you can make your response, the better. Take a few extra moments to review the profile of the person who posted the question. Use the information available to you to custom-tailor your response to their needs. You'll score extra points if you can give a specific example that is relevant and useful to them in their industry or job position. You can also supplement your answer by including links to other web content that might be helpful to anyone who would like to explore the subject further. If you publish a blog, this is an excellent opportunity to link to posts that offer more information about the topic in question. While there is an option to reply privately to the LinkedIn member that asked the question, it will serve you better to post all your answers publicly. By making your response available to anyone who might be interested in the same topic, you'll maximize your exposure to prospective customers and increase the likelihood of reaping good leads from your efforts.

Elevate your profile

As you continue to contribute to the community, your efforts will begin to compound themselves. As an active participant in the Answers forum, you'll elevate your visibility on LinkedIn and gain exposure to members who might otherwise have never had occasion to encounter your profile. Over time, if you consistently provide authentic advice that is sound and not self-serving, you'll develop a reputation as an expert in your field. People will reach out to you based on the depth of your knowledge and the generosity of time and attention that you demonstrate in your answers. Moreover, when one of your answers is selected as best by the member who posted the question, you'll receive special recognition on your profile as an expert in that category. This is a great form of peer validation – an invaluable commodity in any online community. The more best answers you earn, the higher you’ll appear on the leaderboard of experts in your category, giving you an added boost of credibility. Do yourself a favor and check out the LinkedIn Answers forum today. With over 75 million LinkedIn members worldwide, you won't run short of potential leads anytime soon.

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