Loyalty Design

There are many types of loyalty programs, and endeavoring to design, build, and launch a loyalty program can be overwhelming. Examining loyalty best practices, researching different types of loyalty programs, and the associated loyalty business models in search of customer loyalty program ideas is essential, though we'd recommend taking it one step at a time.  Our 4 step process provides a systematic roadmap that delivers the kind of innovation that powers high-performing Loyalty design programs.

Discover: Why Create a Loyalty Program?

Most marketers have a general sense of the need and potential benefit of a loyalty program, whether it be improved customer retention, increased frequency, or higher spending. A sharper level of insight, with a more specific view of the problem or opportunity, will yield a more relevant and impactful benefit to the business.

The comprehensive Discovery process commences by conducting an in-depth analysis of the situation, involving stakeholders from various departments within the company. Additionally, successful programs within the industry are scrutinized to identify the opportunities competitors are pursuing. Armed with this information, the next step involves meticulously examining data patterns to gain insights into the critical inflection points that influence customer retention or transition a good customer into a great one. Through segmentation, issues, and opportunities can be effectively sized and prioritized for action.

Develop: How to Design a Loyalty Program

With the insights in hand, it's time for Loyalty Program Design, which entails iterative development of potential solutions to address the opportunities. Using the LoyaltyLevers loyalty program design framework ensures a balanced approach, tapping into proven psychological motivators behind the tangible rewards and emotional benefits that drive loyalty success and engage members with the benefits through-out their customer journey.

The loyalty design process kicks off with a clear Problem Statement and Point of View (POV), which succinctly outline the most pressing challenge and serve as the foundation for designing the vision. Following this, Ideation begins, initiating the creative journey towards innovation and differentiation. At LoyaltyLevers, we streamline this process through a facilitated, interactive session that brings together stakeholders to brainstorm and prioritize ideas. This collaborative approach aims to identify a key focus area and generate a shortlist of potential solutions. Utilizing interactive software, each participant can contribute ideas, review and expand upon others' suggestions, and categorize them into benefit concepts. These concepts can then be evaluated based on various criteria, ranging from potential impact to operational feasibility.

Define: How to Create a Loyalty Program

Now it's time to define the program more specifically, including a reasonably detailed specification of each of the benefits, and how they'd work together. We typically create several different program concepts, and feed those into market research to get detailed consumer feedback on each, aiding in the selection process and development of detailed financial projections.

Market research typically involves conducting online surveys targeted at specific segments to gauge the attractiveness and potential impact of various program concepts and specific benefit options. To further inform the business case, we delve deeper into current consumer behaviors, share of wallet, preferences for competitor programs, loyalty sentiments, and overall engagement levels among key segments.