What’s the future of loyalty? How we answer the question depends on a number of factors. Where are we starting from? How far into the future are we looking? What effort are you prepared to go to? What do you mean by loyalty?
Everyone has a different context, so everyone gets a different response. Imagine that – an individually tailored response to your exact needs in the moment…
Why you should be asking what the future of loyalty is for your brand
Economists largely agree that we’re heading into a post-COVID “K-shaped” economy. Some businesses will be on a steep upwards trajectory, others a slippery downward slope. What is likely to separate the winners and the losers will be their ability to pivot at speed.
Continuing to do things the way we used to, or even a bit better, isn’t a viable option anymore. The pre-Covid ‘fat’ (yes, really) that meant businesses got away with ‘business as usual’ just isn’t there anymore. Vast departments of people churning out well-meaning but ultimately uninspiring, and therefore ineffectual, communications can’t be commercially justified with single-digit response rates any longer.
CRM and loyalty practitioners therefore must step up and be the innovators and agitators for change. CRM and loyalty practitioners must show the way to leverage the data and tech capabilities that largely exist un-tapped in their businesses already. CRM and loyalty practitioners must get creative and imagine bigger possibilities than a 0.1% increase in already dismal levels of engagement!
Marketers have to examine what ‘business-as-usual’ we can stop doing in order to create the future we know to be achievable. That’s going to mean three things: a shift from data collection to data generosity; a change of gear from push communications to pull preference management; a transition from an army of busy fools to an unstoppable force of centaur marketeers.
The future of loyalty is data generosity that inspires business change.
Loyalty or CRM ‘departments’ need to change. They don’t own the customer – nobody does. They don’t own the customer experience – everybody does. But they do have their hands on real-time, real-customer insights that can make the different between average experiences and spectacular ones.
Creating loyal repeat customers is the job of every single person in an organisation but most businesses operate in siloes and fail to act cohesively. Job #1 in loyalty and CRM has to therefore be: surfacing stories from the data that can inspire an entire organisation to rally around what the customer needs.
Modern CRM and loyalty practitioners therefore must become more generous with their insight and more inspirational in their storytelling.
That means organising and operationalising the data differently. From complex one-off analytics and segmentation projects of old to new, always-on customer dashboards that allow a whole business to see into the lives of customers and act accordingly.
It also means organising outputs differently. From push email factories to more relevant omni-channel multi-touch experiences driven by data.
The future of loyalty is pull, not push
In a volatile commercial landscape such as the one we’re in now, a phenomenon called “creative destruction” occurs more frequently. Businesses face a burning platform that forces them to innovate (or be replaced by another innovator).
In this environment, a points-based loyalty programme built to collect data in the hope it can be leveraged at some point in the future seems about as strategically sound as a wing and a prayer. Standalone programmes that create liability holding and rely on vast teams of people to manage the administration and push out emails may be soon confined to history.
The innovations that are gaining traction right now are recurring revenue models like membership and subscription programmes. These drive progressive incremental value in line with progressive data collection and enhancement and lock in preference through a combination of heuristic levers and triggered automation.
Amazon realised this some time ago and not only operates the most successful loyalty programme in the world but convinces customers globally to pay for the privilege of belonging to their Prime programme. Their pioneering approach to both data management and modern loyalty is why they’re even one of our “most loved” brands as well as one of our most successful.
CRM and loyalty practitioners need to think like entrepreneurs and be prepared to invent the “relationship commerce” programmes that lean into the data and tech possibilities of today. Subscriptions and memberships that have active, pull relationships and recurring revenue models attached would appear to be the best bet.
The future of loyalty is human and machine
It doesn’t suffice to appoint a handful of geeky data folks and drop a couple of million on some martech – no matter what those excellent martech salespeople tell you.
Most businesses already have enough data and technology to keep a NASA scientist happy. Just like humans supposedly only use 10% of our brains, very few businesses are actually realising the potential in that data and technology they’ve already invested in over the last decade. The problem is the finite resources that exist to create the content that feeds the machine. An army of additional traditional marketing professionals still wouldn’t be enough. AI is only part of the answer, because AI needs a partner in crime: people who can co-create with the technology.
A few smart marketing departments are training these “centaur marketeers” to work hand in hand with AI. They push the AI to learn and improve. They create generous ideas that can be evolved, enhanced and executed by the machine. And they ensure that repeatable tasks are handled by automation, so their job is to focus on the future.
This requires new skills and new ways of working and thinking. Only when you work in this way can you handle the tsunami of data that can supercharge the possibilities – personality data, haptic device data, DNA data and more.
“The future is already here. It is just unevenly distributed.”
This classic quote by William Gibson, the visionary sci-fi novelist and sociologist is a good starting point for understanding how CRM and Loyalty are likely to evolve in 2021 and beyond. Pioneering brands are already prepared for the post-covid economy and are training centaur marketeers, building entirely new business models, leveraging the data that exists in their organisation and banning the BAU.
While all this requires some new skills, good CRM and Loyalty practitioners have most of the resources they need to take steps towards the future. The biggest barrier is a fear change itself. But if we assume that change is coming for us, then there is very little to lose.
RAPP predicts that anyone still doing push notifications, points programmes or scheduled email blasts by the end of 2021 will already be well on the way to oblivion. Brands that elevate their CRM expertise out of the basement, into the boardroom are the ones that will thrive and evolve to become the superbrands of the future.