DM News Essential Guide to Lists and Databases: 10 Keys to Customer Loyalty

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In markets that commoditize faster than ever, growth increasingly will come first from defending current share and then boosting share of your current customer's wallet. Understanding the opportunity and pitfalls that marketers now face, here are 10 points to consider when developing and optimizing a loyalty program:

1. Be informed. Use data and analysis to drive your program strategy and ongoing program enhancements. The intelligence gleaned from multiple data sources represents unparalleled new opportunity to understand your customers and react to their needs and wants. Analytics is emerging in the forefront of the drive to develop customer relationships.

2. Be customer driven. Provide genuine, relevant value rather than being promotional. There will be plenty of opportunity for customer input and interaction later in the process, after you have shown you understand what the customer is looking for. As an extension of your customer-centric approach, the communications and benefits should be clear and easy to access.

3. Make your message inclusive. Speak to the needs of all significant subsegments in your target audience. The technology and processes exist to identify all these segments. There's no reason to miss or ignore the loyalty opportunity these groups represent.

4. Differentiate your program. Clearly distinguish your program from your other marketing communications and from competitors' customer programs. Messages have proliferated along with the growth of channels. It's more important than ever to craft a message that stands apart and offers clear, differentiated value.

5. Make it ownable. Provide rational motivators that complement your brand. They should overcome key barriers and support the unique strengths - differentiated branding, operations, assets and product lines - of your organization.

6. Integrate at all touch points. Reinforce the relationship at all points of customer contact. As your customer relationships grow across multiple channels, the opportunity also has grown to disseminate your message cohesively. By integrating your program message into all customer touch points, you can add valuable layers to a lasting relationship.

7. Design for short- and long-term effects. The benefits should motivate and reinforce desired short-term behavior while building brand and a powerful long-term relationship.

8. Structure for efficiency. Your loyalty program should include the benefits, execution structure and execution costs that provide the most efficient return on investment.

9. Create a dynamic environment. The program should grow, adapt and evolve with the changing needs of both customers and the business. We have the opportunity to observe, collect and act on a very rich supply of customer information. If we do it right, it should be an iterative process in which we learn more with each communication, enriching the relationship.

10. Build assets to leverage. Your loyalty program needs to help build data and communication assets that can be leveraged to meet revenue and business planning needs.

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