Customer loyalty: The gift that keeps on giving

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Ginger Conlon, Editor-in-Chief, Direct Marketing News
Ginger Conlon, Editor-in-Chief, Direct Marketing News

Ah, the holiday season. A joyful time for all. Or is it?

For consumers and retailers alike, the holidays can bring as much stress as they bring joy, laughter, and fruit cake. Consumers are concerned about finding the perfect gift at the right price, on time. Retailers are anxious not just about revenue, but also about retaining margin—and customers—while offering the right mix of product and deals.

In fact, the holiday season is the time of year that puts customer loyalty to the test more than any other. Communications across every channel shout about discounts and free shipping and specials galore, all focused on attracting current customers and on seducing competitors' customers. “Come, try us out…and perhaps even switch for good.”

It's enough to give any marketer agita.

So how can retailers spark a bit of holiday magic to keep current customers engaged—and perhaps even capture the attention of prospective customers who are interested in more than a quick deal?

Create a fuss for your VIPs. Host a special event for loyalty program members or other high-value customers. An after-hours exclusive shopping party, for example, may capture the interest of busy customers who want to avoid crowds. Invite those top customers to bring a non-customer as a guest. Those guests may just be future top customers.

Victoria's Secret does this for its Angel cardholder customers. The events aim to create buzz, spark sales, and build customer engagement. I recently attended one and the store was bustling, as were the registers.

Be additive. Instead of offering a discount, try offering a thank-you gift with a minimum purchase to entice top customers into the store. It shows appreciation and, chances are, your customers will leave with far more than the minimum required for the gift.

Hallmark sends select loyalty program members a postcard redeemable for a thank-you holiday gift during special holiday event hours. When I received mine last year I headed to my local Hallmark and bought all my holiday cards, a few stocking stuffers, and more—far exceeding the minimum purchase for the gift. Actually, I gave most of the gift (candles, candy dish, etc.) to a friend. For me, it wasn't about getting a gift; it was about Hallmark showing its appreciation by offering it at all.

Think long term. Ultimately, the way to retain potentially promiscuous customers is to engage them throughout the year. A loyalty program may not be right for every retailer, but a loyalty strategy certainly is. Williams-Sonoma, for example, has created an image for itself as a cooking destination that its customers are likely to think of first if they need cookware or other cooks' tools, and even ideas for entertaining. The retailer supports this by providing content like recipes and guides to everything from grilling to Thanksgiving to hosting a cocktail party. Williams-Sonoma uses email to proactively contact customers with this relevant content to keep them engaged year round.

As Al Urbanski writes in “Loyalty Reprogrammed,” use customer data to treat different customers differently, sending communications and calls to action that are relevant and timely, and see engagement and loyalty increase as a result.

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