Surprise and delight are the two key tools for loyalty, according to Zulfi Tyebjee, MD India, ValuAccess. Speaking on the sidelines of the 7th Food & Grocery Forum India and India Food Service Forum 2014, he also prescribed a phased approach for loyalty programs.
“Phase 1 is acquisition, the key is “not to over communicate and overburden the customer.” Process has to be simple. Phase 2 is to drive revenue by finding customer attitudinal data. Loyalty reward should be relevant, invest in customer service and staff. Don’t make redemption too difficult, and don’t charge people to participate in the programme,” he said.
Tyebjee provided first-hand insights into the most successful schemes and software being utilised and how customer behaviour can be influenced over time to deliver a bottom line contribution to retailer profits. Sharing his perspective on how to influence customers to change their habits, he asked some thought provoking questions on what customers want to purchase, and what time they are coming in to purchase. Tyebjee then shared a framework to identify and look for insights and use of influence tools such as Ratings, E-coupons, and Bonus Value.
He said that appropriately defining a loyalty programme is highly important. However, it is also important to understand that “no loyalty programme is perfect on day one.” It evolves over time. A good loyalty design programme involves data capture, programme architecture and device, and channels to communicate with customers. Customer data needs to be captured from different angles which include interaction data, transactional data and personal data. Architecture involves rating rules and rewards, target groups and features besides other things. Organisation needs to decide on the type of rewards: whether they want to offer points based, cash value, bonus or e-coupons.
In general, he observed that the world seems to be moving away from the points based system, however, in different retail categories, points based system works. Perceived value in points is more.
He also mentioned that communication with customers is key to success. Communication can be in many forms such as E-mail, SMS, Whats App, Facebook and mobile apps.
