With loyalty programs nearing the saturation point in Canada, retailers are having a tough time leveraging their loyalty offer to create a point of difference.
A growing trend in Europe and now North America is the use of short term reward programs to not only influence shopping behaviour but enhance the retailer image in the mind of the shopper. In a typical program, shoppers collect points for exclusive rewards displayed and ready for redemption right in the store. While this concept is not new, what is new is the understanding of the positive impact a short term program can have on long term customer loyalty.
TCC Global, a company specializing in retail marketing programs, recently commissioned research agency Millward Brown to conduct focus groups across North America and Europe to understand how short term rewards programs impact shopping habits, as well as perception of the retailer. “The results were incredibly consistent across retailers, countries and continents,” explains Greg Beehler, the Canadian Lead for TCC Global. “People simply love to collect for a quality reward and when they can see the reward on display every time they shop, they will absolutely spend more and visit more in order to obtain it.”
Shoppers described a kind of `emotional journey’ where their level of engagement and excitement progressed as they earned more points and got closer to redeeming their reward `prize’ right in the store.
The Millward Brown study also reported that shoppers felt the retailer was `giving something back’ for their hard earned money. They felt respected and valued as a customer and in most cases felt the short term reward program was part of the retailer’s overall loyalty offer, helping it to stand out from the others.