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Revealed: The most common loyalty programme design mistakes

20th Dec 2013
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I don't think I'm so unusual in wanting high street brands and retailers to compete for my custom. After all, wouldn’t it be to my advantage if each brand offered me an added value exchange to try and influence where I spend my money?

The most frequent solution (especially on the high street) for creating added value is to hand me a loyalty card, in the hope that it will tempt me back again and again, to gain points, prizes or freebies and ultimately spend more in the process. Keeping in mind that loyalty is the desired outcome and the method of getting there can be wide and varied, if done thoughtfully, brands may even achieve the Holy Grail of behaviour a habit.

Ultimately though true customer loyalty cannot be bought. Brands can, however, steer a consumer in the right direction and make it easy for them to become a customer who, fingers crossed, develops this profitable behaviour.

To do this, the consumer should be at the centre of this process and brands should not presume that they carry their precious card at all times. From my perspective, this can be a fatal error, as it’s unlikely that I am going to carry a physical card at all times ‘just in case’ I decide to buy.

At the last count I had 28 loyalty cards, ranging from petrol stations, coffee shops, fast food outlets and video game stores. So let’s presume I might pass by or might want to use up-to-half of them on a semi-regular basis – this is still too many to even fit in my pocket let alone in the two or three slots left available in my wallet.

So this begs the question: are there any loyalty programmes that make it easy for me to use, remove the barrier of my ‘skinny jeans’ pocket size, and design something with me (not the brand) in mind? Yes, and they are all on my smart phone! My phone is the one item I always carry in my pocket and would willingly install ‘just in case’ apps or virtual cards onto.

The Holy Grail

Picture the scenario: I have a 15 minute walk from a train station to a meeting and fancy a coffee – I know I will pass four places which sell coffee on the way. Pret A Manger and Café Nero have cardboard cards you can get stamped (five of them at home, all with a single stamp on them) and Waitrose will even give me a FREE coffee if I had my loyalty card with me. For Starbucks, however I already have an app on my phone (and a card within my phone’s Passbook) that already has a tenner loaded onto it and a till where I can simply wave my phone at the over-friendly barista without even taking my headphones out. Two thumb clicks later, my soya latte is in my hand, my money is in their bank and I’m walking out with my caffeine fix for the morning.

Ok, ok my loyalty is not from the heart, but the fact Starbucks has made it easy for me to get a coffee (and collect some loyalty points towards some more) has meant that I chose them over a free coffee, or a rival’s loyalty.

The differentiator here is that Starbucks (among others) has designed a loyalty card that allows me to behave like a loyal customer, even if I am neither an advocate of their coffee nor prefer the value they offer in the loyalty scheme. They get my custom and I get my rewards and, at a first glance this does appear to be the perfect relationship. Nevertheless, under scrutiny this relationship is incredibly delicate and open to being replaced, for example by another coffee shop, who’s coffee I prefer, and who has a similar loyalty card app. An instance like this would mean that I instantly ‘dump’ Starbucks. So what else can brands do to stop this from happening? The answer lies with the design.

At Starbucks, I’m able to play with my ‘loyalty stars’ on my phone while queuing for my coffee, which is like some kind of digital snow globe – a feature which doesn’t have to exist to complete my transaction, but is a designed experience that is a branded surprise and delight moment.

If the brand makes the leap to a loyalty card app or virtual card, they should always keep the user at the centre of the ‘journey’ and content, ensuring the interface design is simple and quick. There’s a finite time most people will wait for a bloated app to launch, synchronise and display content, whereas a great design and user experience will get me using it more and showing it to my friends – another Holy Grail in customer behaviour.

Jason Holland is creative director at leading CRM and customer engagement agency, Underwired


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