Year in Review: What 2016 Taught Us Not to Do with Loyalty Programs in 2017
Loyalty programs were on everyone’s minds in 2016 – for better or for worse. From Chipotle to Air Miles’ mistakes in customer loyalty management, one must learn from this and prevail in 2017. The loyalty experts at Paystone are here to tell you what NOT to do with loyalty programs in 2017.
Popular Rewards Programs in 2016
Chiptopia; Chipotle’s three-month loyalty program was deployed in July 2016. This was in an effort to regain their loyal fan base’s trust after the E.Coli outbreak of 2016. Funnily enough, Chipotle’s CEO was quoted several times claiming that they did not need a loyalty program. Why? Because their fans were devoted to their brand’s promise of using fresh produce without GMOs. Turns out, giving out free food and losing millions with a temporary rewards program will not bring back lost customers. To try and save their decreasing sales, a short-term plan was used. Instead, they should have used a thought-out, strategic loyalty program that would have been more effective in the long-run.
Moving on to Air Miles and the never-ending negative attention they got in the media for their loyalty program in 2016. Having your points expire without enough warning and not providing all members with the same rewards made for some angry and disappointed loyalty members. Air Miles learned the hard way that listening to your loyal members’ feedback is important and that there are consequences to taking a shortcut out of a loyalty program.
Even Starbucks and their loyal fan base received criticism when they rolled out the updated rewards program in April 2016. It seems that customers now need to spend more to earn the same, which is obviously not a win-win situation for existing loyalty members.
Top Tips When Designing a Loyalty Program
How can you best avoid the errors mentioned? See below for some quick tips!
- Reach out to loyalty program experts who will help you put your customers first
- Use customer data to best understand their needs
- Reward customers with attractive offers while making sure that you are still profitable