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How to build loyalty in the retail industry – What to factor in when building your own program?


There has been nothing as dynamic as the retail industry when looking back at the last 40 years. The retail industry has to adapt to ever growing changes in market demand, changes in manufacturer and distribution standards and customer relationship standards. The biggest change that has occurred is the different methods in which we are able to shop and purchase items across several platforms. The first initial major change was going to media sources, that being, home shopping TV networks which further led into the advent of internet shopping platforms. From there, social media and other applications manifested into the market to further enhance the shopping experience. Major online stores became household names such as ASOS and now the ever popular Zalando. It is also self-evident that these retail companies employed several means to help maintain their grip in this ever changing paradigm. One of the tools is loyalty programs.

The retail industry is one of the most prevalent branches in which loyalty programs are very popular. It is no doubt that you use one yourself. It is also very likely that at one stage or another you were encouraged to join a particular membership program during your last shopping trip. 

In this article we are going to explore several key elements that play into loyalty programs based in the retail industry. If you are an individual running your own business in this sector, you are probably also considering creating your own loyalty program. Well strap yourself in and read along as we have a few tips to share with you.

First things first – start with a solid foundation

Building good relationships begins at the first moment of the customer’s contact with the brand, as well as at every stage of its subsequent service. If you want to create an effective and attractive loyalty program, you can’t forget about the basics. A high-quality offer, excellent service – are the core elements which need to be focused on before you can think about the next steps.

Before implementing a loyalty program, it is also worth examining the market current situation. Asking yourself questions about the state of the business, current market requirements and the demographic of your particular customer group, are of key importance. If you are unable to carry out this analysis yourself or you want someone to look at the topic from a different perspective we can provide our expert team which can assist in this particular facet.

Second – familiarize yourself with your customer group and get to understand their needs

Although our tips can be applied to various types of stores operating in the retail industry, we are far from generalizing. A well-tailored loyalty program is one that is attractive to a unique group of your recipients. Completely different solutions should be implemented by a jewelry company, and a chain of stores will encourage people to buy groceries in a different way. Your customers will find different modes of operation and mechanisms they deem attractive.

Observe your customers and constantly inquire about their needs. Don’t limit yourself to just collating data but always analyze. This way you can find out what elements work best. Another thing to consider when creating a loyalty program – be open and flexible. Individuals who are dynamic in this industry are always trailblazers.

Thirdly – Create attractive mechanisms that your customers want

In one of the programs we have co-created, Club TARANKO, we have implemented the awarding of additional points for those who have birthdays. The participant in this program also has a chance to receive a pool of points when they first join the program. In the case of BRIJU, we decided to implement additional bonuses for feedback left after shopping. In each implementation, working together with our clients’ brand, we determined which elements are important and what fits in the entirety of the existing relationship with customers. You, too, think about what you care about. Perhaps there is an area that can additionally benefit from the implementation of a loyalty program.

The very selection of the type of mechanism is also based on the above assumptions. A point solution is often used whereby at same time it is flexible and attractive for the customer.

Determining what customers can get in return for points, however, can be completely different. Selected cosmetic products – one of the available options for THE BODY SHOP. An attractive discount – this is the decision of, among others, the BRIJU company. Having such a wide range of possibilities available, you can adjust them to what your company offers.

Remember also about restrictions and additional rules – it is also worth using them when tailoring your program. One example is the ability to collect points for only one year or some other limited period. Or maybe you want to create special promotions in a given month or other time unit? It is an opportunity available to you and your clients to really get at the heart of their desires.

Don’t forget about your program’s communication

Another important factor to consider is when you are building a relationship with your client it is a dialogue. To create an effective loyalty program in the retail industry, you must not forget about this key element. Remember to use marketing tools to communicate your offers – present your customers with the available offer and show what the recipients loyal to your brand can realistically gain. A loyalty application can also be a good avenue which is a convenient channel of contact with the customer. You can read about the importance of such solutions in one of our previous articles.

In summary; understand the needs of your customer base and choose flexible mechanisms that they desire. Do not forget about openness to change as mentioned early, being tenacious and dynamic are the only ways to succeed in the retail industry. These are just some of our tips that we have used during our implementations in the retail industry.

Are you wondering how your next move in the retail industry will include a loyalty program into your business? Contact us. Together, we will build an effective program that will make a leader in your industry.

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