Etailer Loyalty schemes - there's an app for that

If you’re an etailer on a magento or shopify-type platform there are an abundance of apps that allow you to role out a etailer loyalty scheme. They’re almost exclusively currency-based. In other words they use points as a loyalty currency which customers can collect in return for some future reward or discount. Some of them are pretty neat, providing the ability to reward the type of behaviours that etailers like e.g. submitting a product review, sharing products socially, signing up to newsletters.

The etailer loyalty cop-out

Our impression however, is that adopting this plug and play approach to loyalty is a bit of a cop-out. Don't get the wrong impression, we're very much pro-technology. There are so many ways in which technology helps us all to replace inefficiencies or saves time.

But technology which aims to automate the dialogue between etailer and customer? We’re just not sure. Anything that attempts to overly automate the customer experience leaves us feeling a bit cold. It all feels like etailer loyalty is being treated in too transactional a fashion – do this, get that.

So I get 10 extra points, great. What does that mean again?

It’s tough when you’re a small, growing etailer with 5,000 other things to think about. Part of the challenge as we see it, is that there are an abundance of etailers out there who’ve got into the game because they’re passionate about what they sell. Perhaps they were frustrated about the value for money or availability of products in the market previously. We applaud such businesses for trying to be disruptive in their markets.

But the reality is that they’re not all seasoned customer marketers; an important trait for etailer loyalty in such a congested competitive online market. As a result they can fail to see that etailer loyalty apps aren't the only answer to their customer retention challenge. They need to look at the experience from their customers' perspective. Does the current distribution of points make sense? How responsive are customers to these incentives?

An holistic approach to etailer loyalty

Etailers should think about how loyalty is earned elsewhere in life. You become loyal to friends, because they listen to you, ask you questions, respond sympathetically and follow through on promises. Not because they buy you a beer when you see them in exchange for talking at you and asking you to tell everyone else how great they are.

Any retailer is obsessed by product. Without it there is no offering. But without customers there are no sales. Customers need to be nurtured. Only then will they become advocates and market on your behalf. That only happens if an authentic, relevant, human-like dialogue is fostered.

A truly customised approach to loyalty is more holistic and human than an automated currency app. We aren’t saying don’t use these apps. We are saying, don’t rely on them being your loyalty-driving silver bullet. Try to understand your most important customers' journey, mission and motivations and continuously tailor your offering to those needs.