Loyalty programs are an often-overlooked area for performance improvement that can help offset the ongoing willingness among consumers to try new brands and retailers, writes José Carluccio. He shares three key takeaways along with eight drivers of loyalty program value.
Source: McKinsey and Company, October 12, 2021. Link. Key takeaways:
- More than three-quarters of consumers have changed their buying habits in the past 18 months—and are increasingly willing to change brands
- Loyalty programs, properly designed and managed, can unlock significant value
- The key to a loyalty program’s success is having the right data to measure it
INSIGHTS: #5 driver – Measure success based on engagement, not just accruals – is especially important from my experiences. Accrued points favor large purchases but may not represent frequency and recency habits loyalty programs seek to enhance.