On September 27, the Wise Marketer launches our new FREE webinar series, Wise Marketer Insights, which offers customer loyalty best practices, insights, and case studies from leading providers in the customer loyalty space. Our inaugural webinar “Make Your Points Loved Most” is hosted by Loylogic. To kick off our series, Loylogic vice president Judith Raymakers demonstrates how encouraging early loyalty program redemption can lead to increased engagement and increased customer value. For additional insights, please register for Loylogic’s upcoming FREE webinar, hosted by the Wise Marketer, here.
By Judith Raymakers
Member engagement is an essential business priority for loyalty programs and member redemption serves as a conduit to drive engagement. Because redemption offers the opportunity to better connect with your members, encouraging earlier redemption in the member lifecycle can be extremely beneficial and lucrative to your loyalty program.
One of the critical points in a member lifecycle is getting a member to their first redemption. Research has shown that when members redeem, they enter a state of “post redemption bliss” whereby they spend (on average) 30 percent more with your brand for the next three to six months. Therefore, the earlier and more frequent you can encourage your members to redeem, the larger the opportunity holds for your program revenue.
Driving members to this “sweet spot” of post redemption bliss is one of the most direct ways of growing total Member Lifetime Value, and at Loylogic, we have been investigating ways to get your members there as early as possible. Whist working with several global loyalty programs for over a decade, we have come across some interesting means of doing so by supporting our clients with more accrual offerings and by creating earlier redemptions options. As a result of these initiatives, our data shows that the members of our clients redeem six months earlier than the industry average.
Encouraging early redemption with raffles
Within our current Reward Experience Platform, members have the option to participate in raffles for highly sought-after products, in addition to our unique “money can’t buy” experiences. The mechanics are easy and transparent: members buy the amount of raffle tickets they desire in the redemption shop, which they are driven to by a strategically designed communication strategy, and receive an online confirmation of their raffle purchase. At the end of the period, we run the raffle and the winners are personally contacted.
Since implementing this feature for several of our clients, we have seen the number of first-time actives range from 70-85 percent — an extremely successful industry result. Findings such as these inspire us to continue investigating the profiles and behavior in further detail, and we’ve discovered some additional key insights.
For example we’ve learned that the first time’s a charm. Entering the raffle doesn’t require a high number of points, and because of this you might expect that this group of 70-85 percent first-time actives to have low point balances, but in fact the opposite is true: these members have on average almost two times more points in their accounts than members who have participated in raffles before, as well as up to 60 percent more points than members who have redeemed for rewards previously. This reality means that new members with a low points balances, as well as existing members with a substantial amount of points, are both interested in raffles as a lower entry hurdle for first redemption.
We know that the first steps to engage with members can be difficult; our raffle feature has led us to discover a way to lower the threshold for redemption and start interacting and engaging with a completely new target group earlier than ever before. When raffles drive members to the shop we see where members click, which products they like, and can use this data to optimize our view on your members and continue creating a more personalized experience.
One of our goals is to support programs to create and foster long-term relationships with members; we look forward to working with loyalty practitioners in taking this first step toward earlier engagement thus more profitable relationships earlier in the customer lifecycle. For more insights, please join us for our upcoming Wise Marketer Insights webinar: Make Your Points Loved Most. We hope to see you there.
Judith Raymakers is Vice President Strategic Partnerships for Loylogic. To register for our upcoming FREE Wise Marketer Insights webinar with Loylogic, “Make Your Points Loved Most,” please click here.
The post Loylogic Spotlight: The Journey to Earlier Redemption appeared first on The Wise Marketer.