We know you’ve been looking for ideas!
I’m going to start this one off by making a bold statement, something I’m not really known for…
The best loyalty programs out there are ‘promotional’ rewards programs as they provide benefits that put the member first and help brands achieve marketing objectives faster!
That might sound a little vague so let me break it down.
What’s a ‘Promotional Loyalty Program’?
A promotional loyalty program allows members to spend their points on promotional experiences (Sweeps, Instant Wins, Chance Games and Games of Skill) at all times of the program’s lifecycle.
Why are Promotional Loyalty Programs ‘Member First’ programs?
There are two specific reasons why promotional loyalty programs are best for the member!
Firstly, before I tell you why, it’s important to know that this is only possible when you can lower the (CPP) Cost Per Point to the brand by shifting a % of catalog redemption from traditional rewards to members spending on promotions.
If we agree on the previous statement, and you execute properly, you will shift a significant % of redemption.
The Reasons Why…
Now that the brand has lowered the CPP and they know a % of points will be spent on very low-cost promotions, it allows them to reward members with points for every consumer touchpoint and marketing driver without concern. It puts a higher value on the relationship and rewards the growth of that relationship.
Secondly, members complain constantly about the length of time to earn a reward. Promotions help deliver an instant benefit for their participation; they can enter and win on day 1. Far too often, we hear members say….” I have to do what? For how long”?
Promotional Loyalty programs allow you to flip that statement on its head to “I only have to do this, and I have a chance to with that already?” Offering the chance to win is more powerful that most people think and we have the data to prove it.
Can a ‘Member First’ Program Lower Your Overall Rewards Cost?
Offering a continuous arsenal of promotions and prizing will lower your redemptions for catalog items, thereby reducing the overall cost of rewards. Promotions remove points from your overall points economy with a lower cost compared to catalog items. This lowers the cost per point. So not only are member first programs great for members, they are smart for brands.
I will caveat this by saying, working with a company like IC Group that has the platforms and tools to execute cost-efficient promotions is key as the costs of set-up and delivery must be calculated into the overall CPP as well.
Making it Work Long-Term – Entanglement
I’ve talked about something I call ‘entanglement’ before, making your rewards program deep and wide. It has to be at the forefront of activity, consistently, to see its true benefits. Using promotions lowers CPP. So, your opportunity is to offer points for every behavior that benefits your brand and rewards program.
What’s more, if you offer redemption inconsistently, you’re not going to maximize returns allowing you to normalize your CPP models. We’ve talked about the likes of The Kellogg Company doing this well; they have tentacles of sorts that go into every area of their marketing and truly leverage their member opportunity.
At IC Group…
We promote instant gratification, instant satisfaction, instant loyalty.
More importantly, we have the proof that it will improve your relationship with your members and the proof it will lower your costs. Just ask!