Think about the way you watch TV. Who wants to wait a week for a new episode to come out?
Now, instead of having to wait for episodes to come out, you can binge watch most shows by streaming them instantly.
Instant gratification isn’t just a media phenomenon – technology has caused this across all industries.
Tweeting, streaming entertainment, ordering coffee and having it ready when you arrive – We all expect things instantly now. This applies to loyalty programs as well. Gratification used to mean redeeming points for a reward after a series of purchases.
But no one wants to wait for rewards anymore.
The Next Level of Gratification
You don’t have to look far to see this trend, but it’s been largely ignored by the loyalty industry.
Traditional loyalty programs reward customer slowly, which no longer makes sense. This worked in a world where consumers didn’t have as many choices, but that’s not the world we live in today.
Much of the industry has begun to realize points programs aren’t as effective as they were in the past. They’ve moved over to focusing on experiences. This is a good shift.
The only issue is retailers are leaving benefits on the table that customers love. It’s not that customers don’t value discounts. They don’t value waiting for discounts. Sixty-three percent of retail shoppers want instant rewards and discounts now.
In addition to instant gratification, consumers are starting to expect constant gratification. Constant gratification is about creating experiences that make your customers’ lives easier.
By 2020, 45% of consumers say they will switch brands if a company doesn’t actively anticipate their needs.
That means retailers need to do a better job of supporting every customer at every touchpoint all the time.
Your Premium Loyalty Program Should Make Members’ Lives Better
This means going beyond just traditional rewards and finding ways to provide value to your customers throughout their daily lives.
Your customers are becoming more and more empowered by unlimited choice.
They’re constantly exposed to instantly gratifying brand experiences, so you need to look at every interaction as an opportunity to establish deeper emotional connections with individual consumers that will ultimately build real loyalty.
On the transactional side, offer these benefits every time someone shops to make them feel smart and like they’re getting a good deal paying for program membership.
- Instant discounts
- Free Shipping
- Free return shipping
Premium loyalty programs do a great job of providing instant gratification every time someone shops by providing instant transactional benefits like discounts and free shipping.
Sixty-seven percent of consumers said instant discounts that can be used whenever you shop would motivate them to invest in premium loyalty programs.
But you need to take it a step further.
These programs also provide unique experiential benefits that customers can’t find anywhere else.
Consider offering your premium loyalty members exclusive in-store experiences.
Lululemon does a great job of this with its program. Members receive transactional benefits like a free pair of yoga pants and free expedited shipping online.
But they also have access to sweat classes where they can socialize with other program members. These experiential benefits reinforce an active lifestyle that the brand is all about.
The REI Co-Op is another great example.
Members receive transactional benefits in the form of annual dividends and discounts on products, but it doesn’t end there.
Discounts on REI Adventures and lift tickets at popular ski resorts are some of the experiential benefits that members enjoy as well. For people that are into the active outdoor lifestyle, these benefits add a lot of value beyond just transactions.
While transactional benefits provide a clear value proposition and make your members feel like smart shoppers, experiential benefits make people feel special and really allow you to differentiate your brand.
Instant Gratification Should Never Turn Off in Your Loyalty Program
Starbucks is a great example.
Membership has grown over 25% over the last two years and much of the company’s success can be attributed to the program.
Not only do members get discounts and other perks, but Starbucks gathers information on customers’ habits and interests, thus empowering them to offer more relevant perks & communication to customers.
Starbucks has enabled customers to check their gift card balances, points, and mobile orders via phone, website, in-store, or on its user-friendly app.
Real-time correspondence of different channels eliminates the possibility of a lapse in communication.
Add in the fact that members can skip the lines to get their caffeine fix and you’ve just provided an invaluable experience that loyal customers use every day. Loyalty is built over a series of moments and by giving your members value every time they shop; you reinforce those connections.
This article was originally published in the “How to Overcome the 5 Biggest Retail Challenges of 2020 with Premium Loyalty” eBook.
To learn more about the biggest retail challenges of 2020 and how to overcome them, download the free eBook here.