Loyalty Programs Find a Home on Mobile

Companies often try to reward customers for being loyal. Have you had lunch at the same establishment six times in the last month? Here, take this free spicy chicken wrap for your devotion. Restaurants, airlines, credit card providers, and a bevy of other businesses try to encourage consumers to come back to their product by providing incentives, and mobile is making these loyalty programs even more enticing.

For example, let’s take a look at Starbucks. The coffee giant has one of the most successful retail loyalty programs on the market, letting people pay for drinks and food by scanning a barcode on their phones. That’s it. It’s a quick, easy transaction that provides discounts and special offers over subsequent visits.

Simplicity helps lower the barrier to entry for mobile programs like Starbucks, Belly, and Front Flip, but the convenience of having it all readily available on your phone really takes it over the top. Instead of carrying around a punch card that you might leave in a dresser drawer at home, these apps are tied to that all-powerful device that rarely leaves your side.

Mobile is shaking up these once-antiquated programs, but Ad Age understands that there are three major tenets that marketers should consider when building these types of apps.

• First, it’s critical to make personal choice a priority. Customers aren’t going to be happy with a free muffin when all they wanted was that new macadamia cookie, so the rewards that come from these apps should suit the person and avoid the one-size-fits-all mentality.
• Additionally, it’s smart to both keep users guessing as well as communicate what to expect from the program. Everyone likes a good surprise—like getting upgraded to a better class on an airplane after the flight attendant realizes you’ve accumulated a high number of reward points. But that doesn’t mean everything within the app should be random. Keep the program simple and easy, giving clear guidelines on how to get the rewards.
• Finally, understand that there are multiple benefits to your mobile reward program. Having happy customers is right around the top of the list, but you’ll also see a wide variety of user data that can be used in the future. This data helps to better the program and, subsequently, better your business.

There are multiple lists that detail what loyalty programs must have in order to succeed, but what’s most prevalent is the importance of knowing your customer. It’s been hard to get that sort of data in the past, but with these new mobile apps driving reward programs, companies can now much more easily provide the service individuals are looking for.