Who Should Read This?
You work brand-side and you are experiencing one, some or all of these:
- You work in Customer Experience and you’re working on the tactics to support your customer
engagement and loyalty strategy - You work in Marketing and your company has decided to extend your team’s scope of work to include
Loyalty Marketing in the mix - You’ve been tasked to RFP for a Loyalty Program Provider
- You need help starting this process for your company
- You operate a Loyalty Solution now that needs to be optimized to be future-ready
Summary
When deciding to launch or upgrade your brand’s loyalty program, you may need a guide for what to consider as you evaluate the right loyalty solution for your business. There are pros and cons to the options of:
- building in-house,
- buying a coalition solution or
- finding the right platform partner, whether starting from scratch on a net new program or optimizing a current program.
Provider fit will depend on your brand’s customer engagement and loyalty goals, available resources and most importantly what your loyal customers value. This ensures that what you offer will be compelling enough for optimum participation.
The Considerations
1) For brands looking to build a program in-house, consider the following:
| + | An in-house solution will give you complete control to build your program based on your business objectives and customer needs. |
| + | Your loyalty program is internally developed as a pillar of your business and extension of your brand experience. This deep of an investment in Loyalty means it’s a corporate-supported strategy as opposed to a team project. |
| + | You can structure your earning and redemption rules as well as what incentive you want to offer your customers. |
| – | How deep and wide do you want this to go and is your organization ready for it? The investment may have to go as far back as developing in-house Loyalty competency, onboarding new resources and creating a new team. New technologies may be required, with large price tags for your company. |
| – | How nimble and agile is your brand organization? While you may have a need for loyalty solutions, you may face challenges getting on internal project roadmaps or other corporate objectives and expenses may be prioritized before Loyalty projects. |
2) For brands looking to buy or license a coalition solution, contemplate these:
| + | Licensing or subscribing to a SaaS-type solution, allows your brand to lower overhead costs and pull in the expertise made available by the solution provider. |
| + | It is usually quicker to launch because it’s a turn-key solution that fits modules of loyalty needs. |
| – | You are restricted to the rewards that this solution provider supports. Consider if you’re ready to enter into a coalition that will have its own advantages and disadvantages. Your brand is tied to this solution beyond technology integrations but also to their brand reputation, if they can’t white-label for you. |
| – | Expansion beyond the turn-key solutions may require paid add-ons or extra fees for customization. |
| – | The expertise, agility and innovation your brand taps into is constrained by the SaaS-provider’s own roadmap and internal resources. |
| – | Data ownership must be clearly outlined as part of your license agreements. How much of the customer data will belong to and be easily accessible and actionable by your brand? Consider again how quickly you’ll be able to make data-driven decisions to optimize performance and get ahead of any trends that could negatively affect customer loyalty. |
3) For brands looking to find the right platform partner, evaluate this:
| + | Platforms provide the flexibility of what features and functions will be enabled to support your brand’s loyalty goals, within your budget and resource allocations. |
| + | Partnerships offer flexibility and scalability for access to loyalty experts. Brands may choose to configure what service or management model they need from their partner vs what they already have in-house for this expertise. |
| + | Your brand could have the flexibility of configuring what rewards and incentives this loyalty platform could support, which allows your loyalty and rewards experience to be an extension of brand experiences and values. If your customers value branded currency and like that you are part of a larger coalition, you don’t have to replace your current reward currency. The right partner will be able to work with you to make that value proposition work better for your program. |
| + | The right partner will understand that you need to make data-driven decisions and will be aligned with you owning and working your customer data to enable this. |
| + | Your current customer data is a treasure trove of information. Mine purchase and loyalty data with the right partner to deepen customer loyalty and engagement with quicker pivots that don’t require a complete overhaul of your current tech stack. |
| + | Your brand has invested heavily in your current loyalty program and needs to make it work without even more extensive (expensive) investments. The right platform partner will understand if you’re not ready to rip and replace and will be able to offer smarter optimizations for more profitable returns. |
| – | Modifications off-platform may bring additional costs, but if it creates a product or platform evolution, it’s possible that the innovation costs could be shared or carried by your platform provider. |
Next Steps
Your brand is at an exciting cross-roads if you and your team are considering how to enhance your customer engagement and loyalty strategy with the right tools and the right partners, providers or platforms. The right partner will help you assess and execute appropriately on the details of your program mechanics, the necessary integrations and customer experience extension. For your part, ensure you’re clear on why you’re undertaking this work, the boundaries of what you can own as experts and where your brand needs the help.
You love success stories, so here’s one for encouragement for your brand. Read here to see how one brand boosted their existing loyalty solution using personalized offers.
Key Takaways
Don’t forget that whatever Loyalty Solution you choose, it is still an extension of your total customer experience. Brands that haven’t invested in getting the basic customer experience right, will have poor returns regardless of how slick their points or rewards proposition is. Ask yourself if your desired loyalty solution properly supports your full brand experience. Make sure it does and see member participation reflect customer engagement and brand loyalty yield business profitability.