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Will AI replace traditional loyalty programs?

The face of customer loyalty is changing constantly with the increasing cut-throat competition between companies. There are a hell lot of retail options available to customers. So what makes a person choose one over another? And there comes the most basic customer retention techniques- rewards for their loyalty. They have made themselves as Loyalty Rewards Company – a give-away reward to retain their customers. But is it the future? Do customers really want to be engaged in this way only?

The future is Artificial Intelligence. AI will help in gaining a foothold in this very competitive environment. AI consists of speech recognition, natural language understanding for creating better intelligent assistants. They will help customers with accessing information and completing tasks. AI will result in better business processes and customer orientation. The urge is there from customer side to make it more personalized and nothing can do it better with Machine Learning, which is a part of AI. Companies like Nectar are leveraging upon the technology giving their customers more personalized offers and they are very successful. As more customers use their Loyalty Rewards Programs and other digital channels, the better the machine learns about what is relevant for them. Customers are more likely to shop with retailers that deliver more personalized experiences.

Machine learning will totally eliminate the guessing work, it uses the data & analytics to provide the most likely predictions. Loyalty Reward Management programs basically will be utilizing the customer’s prior behavior on certain set of rules. For example, AI facilitates virtual assistants that can monitor the customers on the basis of their engagement in good behavior and then they could be rewarded for it. This reward would lead to more loyal behavior, and all of this will be done without any human interference. Further, this will significantly reduce the marketing cost since they would be targeting only the most relevant customers.

In the very future only, machine learning and AI would be touching every industry and customer loyalty is no different. A Loyalty program company which will use AI and Machine learning will no longer have different teams working on different campaigns for designing and managing offers schemes and discounts for their customers. So, with the help of Machine learning, they would not have to push 200 offers to everyone, but to push 20 offers for 20 type of audience which would have a higher conversion rate with low cost.

Also, the ability to deliver real-time personalized offers based on the ever-learning algorithms will completely replace the traditional loyalty programs. AI will disrupt business functions in nearly every industry. Different loyalty rewards companies are heading towards adopting this technology for better retention of their customers.

Millennials as customers and how to gain their loyalty

It is the age of the millennials — also commonly known as the Gen Y. This savvy generation not only comprises smart customers, but also include decision makers in top firms. Holding the largest share in the consumer marketplace, they have taken it hands on to change the rules of how brands engage and conduct their customer-experience design. It’s both easy and difficult to gain millennials’ loyalty. But the job is half-done once their tech-savvy psyche is grasped!

1. Customer-facing technology can’t be slow or complicated

Millennials have always embraced and aligned themselves with technology. So a user experience that is not friendly, simple, fast and advanced, is generally frowned upon by consumers. Companies should be careful not to present an obsolete process or a complicated system to consumers that will keep them away.

2. Smartphones have been the norm for millenials

Millennials are used to getting everything immediately and experiencing everything in real time. The queries need to be attended to as soon as possible and in an authentic language; otherwise, the customer moves on to someone else who understands him/her more.

3. Purchasing, for millennials, is a social experience

Engaging on social media is a part of everyday life for millennials. Often, these posts concern their consumption activities, their next purchase or what they might be looking for. This greatly affects businesses — as the opinion and review of one consumer could influence another.

4. Millennials seek an authentic and engaging experience

Which is why the company website should include a FAQ page — how to go about making a purchase, detailed repercussions of what could go wrong, or any sort of guidance. This can be done either through articles or videos — where customers can discover quick-fix methods and find instant solution to all their problems.

5. Interference or help from customer care is considered tedious

This means that they are self-reliant too and do not need customer-care executives getting in the way, just to mess up their whole experience. More often than not, they would prefer self service.

6. Surprisingly, they also want to co-exist

They’re open to new experiences and want to associate with the brand more than with just a transaction. To speak plainly, millennials are adventurous and seek the same from the brand. For example, a cause supported by a favourite company would also be supported by the loyal customers.

The bottom line is that — nothing with the millennials can be taken for granted. The skeptical approach of the previous generations also needs to be done away with. They move fast, like to experiment and are prone to changing loyalties only after one bad experience. It would also be good to know what the target audience is, in order for customer service to be innovative, seamless and top-notch on the whole.

The Future of Loyalty Programs

The success of an idea depends on how adaptable it is to the current needs of the system. The ability to amend brand strategies is the key to longevity irrespective of the industry, including the wide domain of customer loyalty. In recent surveys, a massive 65% of the CMO council agreed upon the significance of investing in loyalty strategies. A sudden heat is expected in the arena of loyalty, sooner rather than later. A brief study of the Future Loyalty programs in the following section suggests that the coming times will be of huge significance and the right investments might ensure a smooth systematic function.

The future, in case of loyalty programs, is set to drift away from pushing marketing strategies on customers, onto a more promising approach of making the experience a little easier for the customer. With an approach as simple as deploying loyalty program to make customers’ lives easier, or providing an exclusive loyalty program that rewards via a customisable experience based on individual customers’ needs, the future has taken a turn for good. Retailers, who hope to succeed, must possess the content, a strategy and insightful ideas that can be seeded in conversation with customers to figure out their needs and compliment them in a more suitable manner.

A trend of feedback loops with personalisation and targeting engines is set to present itself to the market. The power of a positive review will dominate the centre stage – retailers and brands will be pushing to engage in conversations, allowing them to progressively learn and develop an unrivalled experience for their customers. Loyalty programs that contextualise all relevant data points shall emerge as victors– delivering push marketing messages and lucrative offers to drive customers into the stores or onto the e-commerce platforms is not going to be enough. Successful retailers and brands must know and comprehend what their customers tend to and analyse the data to fuel targeted conversations that enable the loyal customers to open up about their experiences. Negative criticism is set to trend with a strong, reassuring vibe attached to it.

Loyalty programs, if aimed for huge success, need to continue to support an overall experience of the brand, and should be designed with customers, taking in consideration the minutest of details. The retailers and brands need to embrace the need of the hour; they need to give up control. The real power of loyalty is to enable customers to voice an opinion; loyalty programs will increasingly align themselves to the customer experience side of businesses and emerge as a channel for developing connections with loyal customers on a personal level.

The future of loyalty programs needs a retailer or a brand to enable a broader range of interaction with their customers. Personalisation and customisation, are therefore the keys to ensure the right elements of customer experience are delivered to the loyal customers. They generate a high value of engagement and equally, retailers need to create opportunities through their loyalty programs for customers to engage with their interests.

Loyalty programs have the ability to connect the dots of data from across the multichannel experiences and recognise the areas to be emphasized upon. Mining the data to create these opportunities to strengthen and improve one’s service is an invaluable and relatively untapped resource for retailers. With such advancements and a rising need to acquire the customer base, the future of loyalty programs, it seems, is infinitely bright and headed towards a remarkable journey.

Top 5 Things Not to Do in Your Employee Rewards Program

Employee rewards programs sound like something we can all benefit from, based of some known facts: generic rewards aren’t entirely effective, whereas the ones tailored to compliment the company can have a significant impact. Custom employee rewards contribute significantly to boost the engagement and company culture. Upon due consideration, we must realise the fact that implementing a rewards program isn’t always a step forward to success, unless it’s done the right way. Following this statement, is a list of the top five things not to do when designing a detailed employee rewards program:

1. Turning a blind eye to the history: One must never design a rewards program without an in depth knowledge and a detailed insight into the company’s past history with rewards. Finances are always to be kept in check; the tangible rewards mustn’t be finalised without identifying the appropriate behaviours to be rewarded. Rewards can be misused and misdirected; behaviours can’t always be changed without social reinforcement. Make wise decisions because reward programs tend to take the wrong direction, a consequence of an unplanned beginning.

2. Basing KPI’s on biased assumptions: Presuming that one knows what behaviours should be rewarded to produce the desired business growth, can be a reason for an unsuccessful rewards program. Observe, learn, converse, and connect with the employees to identify the behaviours that need addressing. Basing KPI’s on assumptions leaves a scope for biased opinions, which in turn, leads to undesired growth factors.

3. Ignoring the objective metrics: Know the objectives of your rewards program and figure out a way to measure them. A common mistake occurs when only the subjective measures of effectiveness are considered, ignoring the objective metrics. Rewarding the wrong behaviour is never recommended. Remember, what you reward is what you’ll receive.

4. Undermining the feedbacks: Rewards program tend to flourish when they incorporate employee and manager input. The job isn’t done yet, with rewarding; it requires taking feedbacks to find out if the reward makes an impact. Ask the recipients for a scope of improvement and apply the principles learned to design better the next time.

5. Underestimating the significance of recognition: Individuals who earn the rewards for their exceptional performances must know the specific reason for the recognition. A meaningful, sincere recognition encourages a positive behaviour in the future. Don’t restrict the rewards program to a mere transaction; it can be a great step forward to build personal relationships.

Appreciation is a fundamental need for humans to work with some motivation. Employees respond to appreciation because it is a reassurance of the value of their work. When recognised in a proper way, the productivity is set to increase, for there is a motivation to keep up the good work. Hence, an employee rewards program requires a lot of planning and organisation, to work in an unperturbed fashion; keeping in mind the foremost things to avoid. A well planned ERP can act like a catalyst, and give cause to an exponentially rising upsurge in the business charts of a company.

Omni channel engagement for small and mid-size companies

A recent study showed that customers are 58 percent more likely to tell others about their experience with a brand than they would have done five years ago. One important outlet for this exchange is the social sphere which gives consumers and businesses the opportunity to reach lots of people.

As the taste of consumers align with new market contexts, businesses must look for applicable ways to engage them beyond building traditional relationships. Most customers expect their vendors to engage with them through digital channels.  Interestingly, it is not just one channel but an Omni channel approach. This includes the social media, the web, email and other channels.

Small and Mid-size companies must take advantage of these new outlets to drive their brand. The technological and demographic changes that are sweeping across the economic landscape have changed the playing field. Most customers prefer having their questions or problems resolved without needing to talk with a customer service agent. Furthermore, customers want to engage with a brand on their own terms; either through human interaction or a digital channel. Small and Mid-size organizations that do not offer multiple engagement channels may sabotage their relationship with their customers or remain at a competitive disadvantage.

It is important to have a portfolio of services that connect with your customers when and where they want. The Human and digital channels of interaction must be properly optimized.  Every business can get a virtual receptionist team which can double as a virtual assistant. They would screen and transfer calls to a representative of a small business based on agreed schedules. Beyond the administrative functions of this team, they can process orders, make outbound calls, answer customer service questions and schedule appointments.

Another important platform is to run an effective digital engagement system.  A good digital platform allows your customers to be educated on your business and product offers, amplify the sales process, resolve service issues, connect with prospects, answer customer questions and so much more.

When your Omni channel platform gives an outstanding experience to your customers, they ultimately become your brand advocates. It is essential to buttress the fact that great customer service occurs on multiple fronts. There is no leading brand that can retain a large share of the market by using one channel to reach its audience. Customers need a relevant, compelling and consistent service to remain loyal to a brand. When your business has many advocates pushing its case in the market, it creates a positive impact on your bottom-line.

On the long run, one positive customer experience reduces the number of service inquiries that you get. The customers who are loyal to your brand begin to share their good times with others. The place of good customer service goes beyond the one on one relationship you share with your customers. It is important to entrench your brand and connect with your market through the multiple channels that are available. With a careful forecast, investment and plan, any business can be able to position their brand as leaders with a viable Omni channel framework.