• by Dan Jurek , December 7, 2021

To stay effective, loyalty programs must evolve. Even the best-designed programs need frequent, data-informed updates to leverage new consumer expectations and technology. Failing to do so could limit your brand’s bottom line and diminish opportunities to build loyalty.

Here are eight signs your brand needs a loyalty rehab—and ideas for how to do it:

1. Customer conversion rates are dropping. Red alert: It’s likely your brand’s loyalty program value proposition isn’t compelling enough.

• Do a competitive loyalty program audit, and implement a test plan to compare different incentives for signing up—e.g., percent-off or dollar-amount savings versus a registration gift.

2. Active, high-value members are hitting snooze. If members who were once highly engaged decrease their earning and redeeming, your program has probably become predictable—maybe even boring.

• Boost engagement through surprising, spontaneous offers, and find ways to celebrate unusual loyalty milestones—e.g., a member’s program anniversary.

3. Members protest that new members and/or nonmembers can access the same benefits. Members who’ve invested significant time and money usually feel entitled to special treatment.

• Differentiate member benefits by spending and/or tenure. Create exclusive offers to recognize and reward high-value members.

4. Members say it’s too hard to earn rewards. If the threshold for earning a reward is too high—or even too low—the program’s value exchange needs retooling.

• Add low-cost rewards with a high perceived value, such as rewards with a high emotional appeal, e.g., early access to new products or services.

5. Your loyalty program isn’t crossing demographics well. It’s likely your program’s content strategy and segmentation aren’t effectively reflecting the demographics, interests, and attitudes of your customer base.

• Compare the findings of a customer segmentation or personal audit against your program’s current offers, messaging, and channels to uncover opportunities to optimize.

6. What loyalty program? Loyalty programs wither without sufficient visibility among your customers, so leveraging communication channels effectively is key.

• Initiate a customer experience audit that looks at all customer touch points and content. Compare that information with your competitors’, and address your program’s gaps.

7. Members are struggling with your brand’s app or other tech. We all know the frustrations of glitches and bugs, and members may not stay patient with your brand if they encounter too many.

• Invest in a thorough marketing technology audit—of databases, content, commerce, omnichannel delivery, all of it—to find and smooth out any issues.

8. Loyalty members aren’t buying into product recommendations. Most loyalty programs drive significant revenue through upsell or cross-sell of sales and/or services using a personalization engine.

• Assess your brand’s personalization capabilities as a first step in determining how to deliver highly tailored—and more effective—loyalty messaging.

Keep your loyalty program up to date

As consumer expectations, trends, and technologies evolve, successful loyalty programs need to keep pace. Developing a strategy of an ongoing evaluation and strategic revisions will help your brand make incremental adjustments to improve customer experience, loyalty, and overall profitability.