The massive proliferation of connected technologies and soaring smartphone adoption rates, has led to creating well informed and empowered customers. Retailers and brands which once used to focus purely on engaging customers will now have to work doubly hard on building solid customer relationships in order to ensure sustained brand loyalty. The traditional approach of offering loyalty programs through loyalty cards, loyalty stamps and coupons might not be the best way to connect with today’s mobile first economy. Powerful new technologies like iBeacon help take traditional loyalty programs to the next level, by offering tailored, data driven, hyper-local loyalty programs directly on customers smartphones.
Beacon enabled loyalty programs allow for all loyalty related information to be directly saved on customers’ smartphones (on the retailer’s app) and it automatically gets updated as and when required. Apart from the apparent ease of use, beacons also gather valuable data about customer preferences and behaviour. Some of the key loyalty metrics that can be captured using beacons are visit frequency, repeat visitors, retention and cross-store visits. Such deep insights about customer behaviour allows retailers to measure the effectiveness of promotional loyalty efforts and make immediate changes if needed.
Given today’s omni-channel retail landscape, it is essential that retailers connect with customers in their micro moments. The multi-contextual nature of beacons thus provide the perfect platform for retailers to constantly change promotional content according to changing requirements. Popular beacon loyalty solutions include incentivising purchases, incentivising visits/time spent, providing discounts and, incentivising for contest enrollments among others.
Given the significant benefits of beacon based loyalty programs, let us now look at the best practices for integrating beacons into retail customer loyalty programs.
1. Send highly targeted promotions
Beacons primarily allow retailers to identify the precise location of customers in store. Hence, if a retail store wants to promote a specific product, it can configure the beacons to trigger custom notifications to customers who walk into the zone where the product is placed, as against sending a blanket message to all customers in the store (which would lead to several lost impressions).
The versatility of beacons also allows retailers to design complex promotional programs. Apart from incentivizing purchases and providing discounts, beacons can also be used to deliver unique and innovative solutions like broadcasting videos, collecting feedback, running contests and giving spot rewards. For instance, if a store wants to improve its mid-day sales, it can run a prize promotion through beacons that increases the chances of winning the prize at mid-day.
An excellent example of a beacon based loyalty program is that of Sephora. As part of it’s ‘Beauty Insider’ program, Sephora offers a variety of loyalty notifications to customers, depending on their specific location inside the store. Apart from general messages that are pushed to customers in the store, there are also special “get a mini makeover” notifications that are sent to customers near the store’s Beauty Studio. In addition, beacons placed near billing counters send notifications with regards to individual loyalty points.
2. Send reward points notifications to customers
Reminders about accumulated reward points are often appreciated by customers. Beacons can be placed at prime locations of the store, like entry points and billing counters, in order to send reward points reminders to customers and boost customer engagement.
3. Gamify the loyalty program
Gamification is the latest buzz word in order to garner customer interest. Customer loyalty programs can also be gamified using beacons. Experiential loyalty programs and promotions (like in-store treasure hunts) are definitely a great way to create a behavioural shift among customers.
In a recent example, Macy’s conducted a beacon- based promotion called ‘Macy’s Black Friday Walk In & Win Contest’ with the intention of popularizing it’s Black Friday sales. As part of this promotion, customers had to get ahead of the Black Friday crowd and enter the store in order to instantly win gift codes, trips to New York, makeovers and other prizes. Such promotional notifications were broadcasted directly to customers’ smartphones via beacons.
4. Gather important feedback
Collecting and understanding preferences and opinions directly from customers can be an important source of information to retailers. Beacon-based loyalty programs create unique opportunities to collect customer feedback instantaneously; surveys with regards to various aspects of the loyalty program can be directly collected through the app on customers smartphones.
Data is a crucial component for beacon-based promotions . Precise data leads to highly targeted and personalized promotions, leading to better conversions and higher customer satisfaction. The best approach for retailers to gather customer data is to have a transparent data policy that encourages customers to voluntarily opt-in and share data . Retailers should also ensure that there is clear communication to customers regarding the need for such data along with the benefits of the approach.
Thus, retailers can leverage beacons in multiple ways for their customer loyalty programs and promotions. Beacons are not only valuable in physical stores, but can also be used as a tool to nudge online customers to visit the store, in order to benefit from the loyalty program.