Consumer distrust at an all-time high. The modern consumer finds personalization initiatives derived from cookie tracking, location data or social media activity to be creepy, not cool. Vast swathes are turning away from brands due to ethical reasons, like environmental, corporate, or political values, and many are going as far as to instal ad blocking technology to protect themselves from overzealous marketing. In this landscape marketers are increasingly concerned about their ability to capture customer data at scale, and in ways that are meaningful and engaging.
Despite the pandemic, or perhaps because of it, experience-led loyalty mechanics have become more powerful than ever. Leveraging the idea of fun to capture data and create progressive profiles of customers in ways they enjoy, rather than avoid.
Cheetah’s CMO, Richard Jones joined the 'Let’s Talk Loyalty' podcast and explained: “just because in the past we've been able to get drunk on data doesn't mean we should continue to do so in the future. Customer values have changed, and it's time for us as loyalty marketers to ensure our approach in the past evolves to remain powerful for the future.”
Let’s talk top loyalty stat
There are lots of relevant stats when it comes to the importance of having a fully-formed loyalty strategy at the heart of your customer retention goals, but one that Richard opined as most prescient was this (from Cheetah’s latest research into consumer attitudes to loyalty) 79% of consumers would rather have brands invest in loyalty programs than advertise on Facebook.
There are some obvious conclusions we can draw. If you are over-reliant on connecting with customers through third-party platforms like Facebook, you are exposed — the more we as marketers can build direct connections to consumers on owned channels the better. The more we ask consumers for data versus snoop on them, the less exposed we will be. The more ethical we can be in how our brand responds to questions of data privacy the more attractive we will be to our customers.
Encouraging customer engagement with a value exchange that respects not just their purchases, but their emotional loyalty, will protect our brand’s long term future. In doing so, we will also understand our customers’ preferences, motivations, and desires in a way that much of “Big Tech” and “Ad Tech" have lost sight of.
The value exchange economy
The privacy wary consumers discussed above are not going to hand over their personal and preference data for nothing. You need to offer a tangible value exchange - offering something of value to the consumer in order to receive the data you need.
That means going beyond traditional points-win-prizes, and offering innovative rewards. And it needn't always be a freebie or a red-letter prize, but things like community events, social kudos, exclusive content or early access and the like. One example would be Starbucks loyalty rewards members who have achieved gold status can order the pumpkin spiced latte before it hits the menus - it’s these sorts of rewards that make a customer feel valued, and are the catalyst for them sharing the data required to build lasting more meaningful relationships.
Progressively profiling customers
Loyalty programs have always been a fantastic vehicle for understanding customers. It's not just transactional data that loyalty programs are servicing up, but behavioral and self-reported preference data - zero-party data.
The beauty of progressively profiling your customers, is it never stops. Their interests, preferences, motivations and desires change and evolve over time, and with it, as does your messaging, recommendations and offer tailoring. Through interactive experiences, audience building and profiling helps you keep your data accurate, relevant, and up-to-date, because it’s coming directly from your audience. Constantly enriching and replacing data points with both quality and quantity.
Danny is a Content Marketing Manager for Cheetah Digital. Danny has spent his career in disruptive tech start-ups driving content strategy with a current focus on how brands can connect with modern consumers through a philosophy rooted in self-reported preference data. When he’s not extolling the value of zero-party data, he is guaranteed to be out running.