Top 10 Mistakes Companies Make When Setting up a Loyalty Scheme

At first glance, the concept surrounding loyalty schemes appears relatively straightforward, but in amongst the preparation, development, and implementation, it’s more than easy to make a few slip-ups.

May 1, 2021

Loyalty Schemes

We have come together to reveal the 10 most common mistakes that we see when we step in to offer our support on a loyalty scheme project.

Not Having a ‘Why’ Goal

They’re talked about again and again in business – and for good reason! To ensure success the business must implement a clear strategy that is motivated by a distinguished direction. With direction comes a sense of clarity, this acts as a catalyst for the campaign voice, usability, rewards, and well, basically everything!

Placing Emphasis on Transactions

The common misconception is that a loyalty scheme is created to promote transactions and that alone – well not quite. Loyalty schemes are created to offer rewards, and ultimately the most effective way to implement the scheme is to reward positive consumer behaviours. Driving positive reviews, recommendations, and sign-ups all work towards incentivising loyalty, building brand presence, and prompting acquisitions.

Making Sign-up Overly Complicated

Put yourself in the shoes of your target audience, and ask yourself what is best for their usability? The most successful programmes are those dedicated to simplicity and ease. Endless forms, confusing questions and unclear navigation can all act to discourage a user from joining a rewards system, and worst of all could motivate them to consider one of your competitors.

Focusing Solely on Acquisition

An extensive mailing list is impressive, but loyalty schemes aren’t email lists - despite their cohesion with one another - this is why rewards have to be ongoing. Benefit those long-term customers, instead of just offering a promotional code for signing up. Accentuate value by showing consumers what they could profit from by using the app long-term and offering numerous scenarios in which they can claim rewards.

Not Personalising the Approach

This is what can set loyalty schemes apart from others, personalisation plays a crucial role in consumer retention. A loyalty scheme’s effectiveness is only as good as its ability to be relevant to the consumer; tailor-made approaches allow consumers to specify through their behaviour the type of discounts, promotional offers, and deals they would benefit most from. This is where gamification can come into play, the likes of loyalty levels, rewarding criteria, and activities that allow for extra points, all work to push engagement.

Ignoring Data

Loyalty schemes are packed full of positives, but not just for the consumer. Businesses, with the right support, can reap benefits beyond what was considered possible. Although if we had to pinpoint which one stands out the most it would have to be the increased clarity and understanding of the consumer, and how understanding their behaviour fuels business success. However, what many companies fail to understand is that this process is cyclical, and involves continuous analysing, learning, and implementation.

Not Rewarding High-Value Customers

It’s obvious that loyal customers are more profitable, studies show that prolonged consumer retention promotes more purchases, and it doesn’t end there…customer retention generally costs less than customer acquisition, so it’s a no-brainer!

Having a Complicated Rewards System

Adding, saving and spending points should always be straightforward, the best way to enforce this is to test, test and test again. Through finding out what works, and what motivates your consumers to keep coming back provides the business with a sense of confidence. If there are clear foundational rules that the loyalty scheme can implement, then growth from that point is more likely to be stable.

Overlooking Advertisement

So much time, effort, and money has gone into the development of this loyalty scheme – it couldn’t be better…but no one knows it exists. The more customers that know about the scheme, the quicker it will spread, so amongst the brainstorming and developing take time to consider how the brand will communicate this thrilling, new scheme.

Not Recognising the Potential the Loyalty Scheme Could Have!

The opportunities a loyalty scheme can provide are almost endless, and if you don’t believe us, believe the results! Our specialisms allow us to pinpoint areas for potential and implement the necessary strategies to help your loyalty scheme triumph – so get in touch with us to speak to one of our friendly colleagues.

Get in touch

Whether you’re looking for answers, would like to discuss our services, or just want to know a little bit more about how we have helped our other clients, simply get in touch and we’ll get back to you as soon as we can!

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