Loyalty programs have become much more sophisticated since their inception, but they’ve been around for centuries. In 1793, copper tokens were given to customers by U.S. merchants to use for future store purchases. This idea of giving customers rewards to attract return business caught the attention of other shopkeepers and soon led to many companies offering similar loyalty programs.
By 1896, the tokens were replaced with trading stamps, which soon became the most popular loyalty program in the world. Fast forward to the 20th century, when card-based loyalty programs gained popularity. Fast forward even further to the present day and you see more brands switching completely to personalized loyalty programs via mobile apps.
It’s not unusual or taboo to say that our smartphones are extensions of our human bodies, especially for millennials. Having instant access to unlimited amounts of information has changed the way we perceive that information, especially when it’s about brands that want our business. One of our SpeakingDIRECT authors, Krista Black, recently wrote an article on marketing trends, where she talks about the importance of creating personalized, experience-driven content that engages consumers to act. Her premise is equally true when creating a customer loyalty program geared toward millennials.
The Future of Loyalty Programs for Millennials
Nowadays, it seems there are more brands that offer some sort of loyalty program than those that don’t. The benefits of having a loyalty program are more faithful and satisfied customers, as well as new information on customer needs and wants. A Yes Lifecycle Marketing survey of more than 1,000 consumers and their shopping habits (from Gen Z to baby boomers) discovered that millennials express the most brand loyalty of any generation. This is good news for marketers because it indicates the effectiveness of creating a millennial loyalty program to attract and retain this generation. Take note: millennials tend to stray away from traditional punch-card programs and gravitate toward loyalty programs that create a personal experience with the brand.
Here are three ways you can create a thriving loyalty program for millennials.
1. Create an Experience
Unlike older generations, millennials don’t care about the dollar sign associated with a brand as much as we care about our experience with the brand. Clothing retailer Eddie Bauer offers their loyalty members early access to sales, sneak peaks of products that aren’t on the market yet, members-only sales, free shipping, monetary rewards and points that can be redeemed for free stuff, and more. The more options you have, the more experiences you create, increasing your chances of capturing millennials’ attention—and hopefully their business.
2. Engage Users
Kelli Haemmelmann wrote in Chief Marketer about how brands should consider incorporating gamification strategies into their loyalty programs. She says, “By adding game-like features to their rewards program, brands have the potential to create customizable and rewarding experiences, providing entertainment value to the customer while bolstering engagement.” A recent study showed that millennials are among the highest percentage of mobile gamers, making Kelli’s point stand out even more. Kelli also mentions how it’s a good idea for brands to demonstrate their involvement with charities or support for causes, because millennials are closely connected with brands that advocate for the things we care about.
However, these are just a couple ways to engage millennials in your loyalty program. For instance, the Starbucks rewards program offers music downloads and interactive games along with a ‘stars’ system redeemable for free food, drinks, and more.
3. Ensure Accessibility
Experience and engagement are closely related, but they accomplish nothing if your loyalty program is too complicated to use. Millennials are very unforgiving when it comes to running into issues with technology. Being a millennial myself, I can assure you that if a website or app is slow to load, confusing to navigate, or adds no value, I immediately close my screen. The chances of me surfing that website or app again are slim to none. This holds true for the majority of millennials, so it’s imperative to have a program that is easily accessible through multiple media channels.
Nordstrom does an excellent job creating an easy-to-use loyalty mobile app that is accessible from any smart device. Customers can easily login with touch ID and access all their account information, as well as rewards. They offer new outfit suggestions based on previous purchases and save credit cards on a secure platform for quick and easy check-out, while also allowing customers to track their packages.
Millennials cherish the sense of belonging to something greater than ourselves. As consumers, we want to ‘belong’ to brands that support our interests and, we’re quick to abandon brands that don’t add value to them and waste our time. It’s a marketer’s job to create this sense of belonging with their loyalty programs.
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