messy data to loyalty mastery

From Messy Data to Loyalty Mastery

Loyal customers aren’t just important—they’re essential for business success. They purchase more often and spend more than other customers and can become valuable advocates and influencers for brands. Creating an effective loyalty or reward program has been a strategic move for decades for building and fostering these critical customer relationships. Studies have shown that loyalty programs generate as much as 20% of a company’s profits. In fact, 84% of consumers say they’re more apt to stick with a brand that offers a loyalty program, and 66% of customers say the ability to earn rewards actually changes their spending behavior.

by Matthew Powell

Today’s challenge is to gauge and understand your customers’ ever-evolving needs and preferences for rewards – and how to keep them engaged. A recent Deloitte survey revealed that consumers’ loyalty program expectations are changing quickly. While financial benefits are still a big driver, consumers increasingly seek services and experiences that reflect their journey and growing relationship with a brand.

The Loyalty Data Imperative: Unifying Customer Data for Unrivaled Rewards

With these ongoing fluctuations and emerging trends affecting customer tastes and behaviors, the question becomes: How do businesses structure the right rewards program that drives the best, most impactful brand loyalty?

The answer lies in data. It is critical to understand all parts of your customer, track their journey, and consolidate all the disparate data into one unified platform. Effectively using data can help businesses strengthen their relationships with consumers and enhance loyalty across the board. With that in mind, companies should follow four pivotal steps to grow customer loyalty and improve their reward programs.

Step 1: Laying the Groundwork – Establishing a Clean Data Foundation

Start by establishing a clean, unified data foundation to ensure accurate and comprehensive customer profiles. This process involves integrating, cleaning, and deduplicating data from online and offline sources. Once this critical step is complete, you’ll have a more comprehensive view of your customers, which is crucial for understanding trends and preferences.

Unified data allows you to understand better who is and isn’t part of your loyalty program and highlights issues like customers with multiple loyalty accounts. Duplicate accounts can create a fragmented or inaccurate view of customer behaviors, preferences, and purchasing histories, potentially skewing your marketing and sales strategies and wasting precious resources. Duplicate accounts can also create confusion if a customer receives inconsistent messages. With a unified view of your customers, you can provide the exceptional value and personalized experiences necessary to turn your customers into brand champions, maximizing your marketing and advertising budgets.

Step 2: Targeting High-Value Customers – The Power of Look-alike Modeling

Once you’ve established your data foundation, the next step is to identify high-value customers. This group not only drives a large portion of your revenue, but they also are the backbone of loyalty program design. A unified customer view helps brands unlock more granular analysis and understand what’s working for their best customers.

Next, build look-alike audiences to identify prospects with similar behaviors and potential value to your best customers. You can build targeted campaigns to grow your member base using this data. 

Analytics tools can enhance your marketing strategy by integrating accurate data, thereby increasing its effectiveness in attracting valuable customers.

If a large segment of your customer base hasn’t joined your rewards program, you’ll want to offer non-members a reason to sign up. You can do this by engaging this audience with personalized communications and providing incentives through a tailored rewards program using the data and information gleaned from their preferences, interests and behaviors. Brands need to understand their customers really well and design the loyalty program around who they are and what they want.

Step 3: Delivering Personalized Experiences – Tailoring the Customer Journey

From the very first interaction someone has with your brand, each communication and service experience should be tailored to speak directly to them. Personalizing your outreach across marketing messages, sales engagements, customer support, and post-purchase communications will make customers feel valued and appreciated.

To customize marketing effectively, you must use customer data strategically. Begin by segmenting your audience based on behavior, preferences, and purchase history to create more relevant content. Then, use analytics to predict future buying patterns and tailor your marketing campaigns accordingly.

You can also engage with your audience through social media, surveys and other channels to gather feedback and refine your marketing approach. Personalized marketing provides value at the right moment and in the right context, making the customer’s journey with your brand feel unique and relevant to them.

Step 4: Measuring Success – Optimizing Strategies for Deliver Impact

It’s essential to periodically evaluate your loyalty strategies, refining them consistently based on key performance indicators. Consider tracking metrics such as lifetime value, retention rate, return on ad spend (ROAS), CAC, and conversion rates. These metrics offer valuable insights to help you tweak and enhance your strategies.

Wyndham’s Winning Approach: A Data-Driven Loyalty Success Story

Wyndham Hotels and Resorts provides a perfect example of an organization that has adopted these data-driven strategies to enhance its loyalty program and boost direct bookings. The company lacked accessible, reliable customer records, with data scattered across disparate systems. They needed a single source of truth for all data to understand customer journeys and optimize marketing efforts.   

To address these challenges, Wyndham implemented a unified data platform empowering teams to glean actionable insights, segment audiences, and deploy targeted messaging swiftly, driving up bookings and loyalty sign-ups. The outcome was impressive, with double-digit increases in ROAS and loyalty conversion rates, showcasing the tangible benefits of a measured and data-focused approach to loyalty enhancement.

To cultivate lasting customer loyalty, brands should build a robust data foundation that integrates clean and unified customer profiles. Companies can use this data strategically for personalized engagement and tailored reward programs to deepen customer relationships.

Regular evaluation and optimization of loyalty strategies, informed by critical metrics, will ensure these efforts align with consumer behavior and business goals. No matter the industry, companies can learn from business leaders like Wyndham and other pioneers who embraced the power of data to build their reward programs and sustain loyal, happy customers.

Matthew Powell is a seasoned marketing professional and customer engagement specialist with over 13 years of experience in the field. Currently, he holds the position of Director of Pre-Sales Solution Consulting at Amperity, where he leads a team of technologists in developing customized marketing presentations and data-driven solutions for enterprise consumer brands. Prior to joining Amperity, Matthew served as a Principal Solutions Engineer at Salesforce, where he distinguished himself through his innovative approach to customer engagement solutions. His professional journey also includes significant roles at Cheetah Digital and Experian, further solidifying his expertise in driving marketing success through technology.

Photo by Karen Maes on Unsplash

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