Loyalty Programs – everyone is trying it, but very few are getting it right. Shopping centres are becoming increasingly experimental as the race is on to become the most digitally connected centre. A loyalty scheme is an obvious choice when looking to bridge customers online and offline shopping experiences.
Loyalty programs have three main functions for shopping centres, malls and outlets.
- To reward shopper loyalty
- Strengthen centres relationship with the tenant
- To provide the centre and tenants with a wealth of intelligent customer data
Loyalty programs also have several benefits for the tenants, shoppers and the centres themselves, including
- Boosting a customer’s lifetime value
- Enhancing the shopping centre’s brand
- Increasing shopper dwell time and transaction frequency,
- The ability to track spend per customer and ATV (average transactional value) to better understand shopper behaviour
- Improving the customer experience by rewarding their loyalty
Such programs are a great way to measure marketing activity more effectively and encompass trending customer behaviour into future strategies.
While there are many perks to implementing a loyalty platform, occasionally, these are not being experienced as shopping malls can fall into common pitfalls, preventing them from getting the most out of the program.
1. Disengaged tenants
It is essential that tenants are entirely on board with the loyalty platform. The bottom line is that if centres aren’t able to present brand rewards or something ‘exclusive’ from their brands, then they won’t have a successful loyalty scheme. Shopping Centres need to approach tenant engagement with a focused strategy that highlights the benefits and customer data that they will receive through the system.
Most importantly, centres need to communicate with their tenants regularly or have dedicated brand engagement teams in place.
2. Over complicating loyalty programs
Loyalty schemes need to be easy to use for shoppers. Customers are typically busy and often stretched for time. The loyalty program needs to be easy for them to adopt – from the sign up to points redemption and collection.
As a rule, loyalty schemes must contain a maximum of three barriers to entry for customers.
Additionally, retail destinations need to consider whether their scheme is engaging and relevant to their customers. Personalise and optimise rewards for shoppers to ensure that high-value customers receive a promotional offer that entices them to visit again.
3. Ignoring tech opportunities
It is now widely recognised that the customer journey is complex and at times fragmented. Many customers do not shop via a single channel and often switch between visiting in-store and researching products online before purchasing. As the customer is becoming increasingly connected, loyalty schemes must have an omnichannel approach.
There are various types of technology to consider, but the most important are registration and redemption. Registration is often most effective when it happens at the point of sale (POS), and for redemption, it is beneficial to offer numerous options to cover all tenant’s requirements. These options can range from standalone scanners to POS app integration. By covering all bases for tenants, it becomes easier for tenants to get involved without disrupting their existing operations. This can also extend to including digital redemption built into the app, allowing the customer to redeem rewards on a channel of their choosing.
4. Going solo
Unless the shopping centre is happy to spend years developing and planning a scheme, has a data analyst team, loyalty specialists, and an ‘offer sourcing’ engagement department, we strongly advise you to work closely with a partner.
To fully gain an advantage over your competition, the partner needs to have the right technology and the ability to launch the scheme across multiple centres in a matter of months. Working with a specialist partner like coniq, who has a dedicated tenant engagement team, can help shopping centres launch a program that encourages most of the centre’s tenants to get involved.
5. Lack of promotion
A loyalty program is a great marketing opportunity to build hype around a shopping centre, but without active and strategic promotion, no one will know it exists.
It is essential that shoppers know about the scheme and recognises the benefits it presents. When promoting, it is vital that centres carefully consider the position of the program and the messaging behind the promotion. One effective way to highlight the scheme is to create a sub brand name for the program. Trinity Leeds successfully did this with “Love Trinity Leeds.”
To optimise reach, retail destinations centres can utilise all channels like email and social media. At coniq, we typically see more than a 40% open rate from customers registered to loyalty schemes. That is over double the national average open rate for the industry.
6. Neglecting data
Centres need to have a clear strategy for optimising and utilising the customer data collected so they do not get overwhelmed by the sheer scale of it. Data should directly inform marketing strategy through the visibility it provides on customer shopping behaviour.
Shopping mall wide loyalty schemes can provide tenants and centres with detailed insights into customer trends and behaviours, presenting many benefits to both businesses. For example, shopping centres can determine how much an individual shopper typically spends and how much they’re spending on specific brands. Be careful if the scheme is set up or used wrongly. These benefits will not only be unobtainable but costly and potentially a cause for lost customer loyalty.
When economic uncertainty is high, it is more important than ever to ensure that customer experience is optimised and loyalty is encouraged.
Ultimately by ensuring that you avoid all six pitfalls, your centre and retailers will have a healthy two-way relationship with high value customers.
