The Definitive Guide to Loyalty Marketing Automation
Recently, I attended an eCommerce marketing meetup. There I met John, owner of an electronics retail business. As we were talking about each other’s companies, I asked:
“John, what’s the biggest struggle you face as an eCommerce marketer?”
And he honestly replied, “You know, my business has grown really fast. But there is one thing that gives me a real headache. Finding a way to send offers automatically to my top customers, which encourage them to make more purchases.”
His reply led me to a big realization.
We write – and also talk – a lot about how loyalty programs can help boost sales, by nurturing and engaging customers throughout the life cycle. But we have not yet gone over how exactly automation is involved in this process.
That’s why I decided to craft a post on this topic… but before that, let’s have a quick overview of current automation trends in eCommerce.
Trend No. 1: Bots as personal shoppers
I remember the first time I talked with Cleverbot. It’s an online bot you can write to – even write about the most hilarious things, like how badly you want world peace, and it replies to you like a real human. The bot is witty, cute, and can make you smile for hours on end – it even started hitting on me last time we spoke. No kidding. Would you ever have thought that the machine learning mechanism behind this bot was born as a concept in 1982? And first came online in 1996!? And we had to wait until 2016, when Facebook gave it a huge boost by starting to use it. They introduced bots for Messenger, “who can sell” your products. The customer, of course, knows he’s not talking to a real person, BUT the whole process seems so personalized that the human mind is simply wowed by it, leaving positive emotions behind. And the next step? Fine-tuning the process with machine learning, letting the bot “learn” how to give the best converting answer to each of your customers. This is the ultimate utopia of one-to-one selling process in eCommerce. (To learn more about Artificial Intelligence and how it can be used in your marketing strategy, check out Boomtrain’s post on the topic.)
In this example, the bot – your online shopper – helps you find the product you’re looking for, in this case a t-shirt. Then it checks if it’s available in your size, sets your delivery details, and all you need to do is pay for it. It’s THAT simple. (Image source)
Trend No. 2: Triggered live chat messages to website visitors
It’s a trend across B2B and B2C – nearly everyone has live chat on their sites. (I haven’t heard yet that chatbots are used there, but if you saw some awesome example for it, let me know in the comment section below.) At Antavo we’re also experimenting with live chat. We use Zendesk’s Zopim chat and send triggered messages to our site visitors, based on the pages they are currently looking at. For example, on our ‘Modules’ page, we ask which module the visitor would like to learn more about? Can we help to chose the ones that best fit to their needs? Thanks to this function, the interaction with our chat tool has increased significantly. Of course, this tool can also be used to promote your ecommerce offers and products, for example, see how our client, Joya Life uses it.
Joya Life sends an auto-message through live chat when someone visit their registration form. In the message they tell you to check out a video about their loyalty program and its benefits. (Spoiler: they reward every new sign up with 1000 points, which is the equivalent of a 10% discount. That’s how they encourage account registrations. Smart, right?)
Trend No. 3: Automated background functionalities
Now let’s talk about other kinds of automation techniques, those that aren’t visible to your customers in the same way as a live chat message or virtual shopper are. Here I refer to tools, like Skubana, which automate the processes you would usually do manually (like shipping labels, printing invoices, packing slips, etc.). This solution lets you monitor what your shoppers are buying, even automating the whole post-purchase process in your business, and helps you keep control over your inventory through multiple sales channels, including protecting your products from over-selling. And what’s more, everything can be handled from one place.
In this video, Skubana explains how you only need one software to automate and manage orders, shipping, and inventory across multiple sales channels, including Amazon.
These are some undoubtedly useful automation trends in ecommerce. But what happens when we narrow our perspective and focus on how automated loyalty program functionalities can upgrade your marketing?
From marketing automation to loyalty marketing automation
Sam Mallikarjunan from HubSpot emphasizes that marketing automation is necessary because it helps you personalize the customer experience, which is an important step in building customer loyalty. (Remember the delightful customer experience from the three automation trends from above?) He also writes that, because of the amount of traffic and data you have, you can’t handle each of your customers personally to create targeted interactions with them, like we can in B2B.
This concept is further detailed by Marketing Automation Insider. They highlight the five most basics fields where marketing automation can help eCommerce:
- managing cart abandonment
- providing analytics
- investigating customer demographics
- running post-transactional email campaigns
- testing product pages to maximize conversion
Magento brings three more important fields into the picture:
- cross-sell, resell and upsell email campaigns;
- reminders based on search; AND
- nurturing leads through their lifecycles.
Customer lifecycle marketing is very important for customer retention. It’s about turning your first- and second-time buyers into returning, loyal customers. (I also covered this topic more precisely in this blogpost where I write about loyalty offers based on the customer life cycle.) Michael Brenner from GetResponse also supports the need for marketing automation and its correlation to building customer loyalty. For that, he introduces McKinsey’s Loyalty Loop model.
The concept of the loyalty loop starts after a customer makes a purchase. After the purchase, he steps into a “loop”, where, based on the incentives you offer him, he’s encouraged to make his next purchases and nurtured to become a returning customer, which – best case scenario – turns him into a brand advocate. (Source)
Nice flow, right? Now let’s see how a loyalty program can help you in each case.
1. Triggered emails & SMS campaigns based on certain customer actions
If you haven’t heard about it yet, we recently began working with Emarsys, an email marketing automation platform. We have an integration with their platform that allows our clients to send targeted email and SMS campaigns to their loyalty program members. Everything is based on what customers are currently doing in their web stores. And, through an API call, our system pushes a trigger to the Emarsys system to send out personalized emails in many ways, including the following:
i) An invitation to your loyalty program after customers make their first purchase
Show your appreciation to your new customers who haven’t signed up to your loyalty program yet. According to TD Bank, 77% of consumers like when brands do so. It’s a nice gesture, nothing pushy, you just let customers know that an amazing loyalty program awaits them, which has many nice offers in store for members only, including special services, offers or events.
Lancome sends out an invitation like this to their non-loyalty members. They highlight a special opportunity to join their league of beauty lovers by promoting a very unique event, which lets customers to customize their own gifts.
ii) Onboarding emails to customers who just signed up for the loyalty program
These emails guide customers through the benefits of using your loyalty program, and explain how points can be earned, what points can be spent on, and how they can reach new membership levels. The gist during this onboarding process is to encourage your new registrants to become active in your loyalty program.
Tokyo Otaku Mode informs their customers that they can earn more points by purchasing select items with bonus points and by participating in a sweepstakes as well. They draw winners every day, and the lucky ones get back the full price of their purchased product in the form of loyalty points. That’s a great incentive to encourage shoppers to make a purchase in the spur of the moment. And a great tactic to use in SMS marketing, too.
iii) Reminders when loyalty points are piling up
Showing a customer’s point balance has two purposes: 1) reminding them that they have unspent loyalty points in their account, 2) encouraging them to use them or to collect more, and to redeem them for the rewards they’re shooting for. This information can be automatically included in all types of emails (or SMS campaigns) you send out to your customers.
Bulu Box always show how many points customers have, in their emails.
iv) The last time loyalty points were used by the customer
There will be always customers who are slipping away from your ecommerce business. It’s up to you to do everything you can to make them change their mind. One great way to do that is to actually show them that they haven’t visited for quite a while. Plus it’s also a great chance to ask them why they’re leaving. NPS survey is typically a tool that you can use in this phase. While telling customers you miss them, you also give them the chance to tell you how you can improve, or ask what kinds of offers would influence them to stay. Every customer wants to feel that their opinions matter to you. Let’s satisfy that need.
Outnorth uses another method to bring back customers who are slipping away. They offer a nice discount with a time limit for use.
v) A customer abandoned his cart or stopped browsing your products
Another typical issue at eCommerce businesses is that customers abandon their shopping cart or leave your site after viewing specific products. Now is a nice opportunity to reach out to them with a loyalty offer, which can be a 10% discount, a chance to earn bonus points, or the announcement of a special event where they can get more points and discounts if they purchase the abandoned products or similar products.
DoggyLoot sends this email those customers who abandoned their carts. They encourage customers to come back by telling them that the items they considered to buy are almost sold out. Who could resists such a nice “notice” next to this cute puppy? Jokes aside, they simply list the products, but this email would be even cooler with a loyalty offer like this: “If you buy them now, you will get back 20% of the total price in the form of loyalty points! Save on costs when you buying the next pack of supplies for your dog!” (Image source)
vi) A customer has a birthday or registration anniversary
The most basic thing. When your loyalty members have their own big days, send them a nice loyalty offer along with your best wishes. But be cautios. According to Adweek, Millennials started to found out that by submitting fake birthday dates, they can get these kinds of rewards sooner. That’s why celebrating the date of their registration in the loyalty program could work better.
In the first example you can see how clever marketers can be when it comes to celebrating the registration dates of customers. You don’t need to wait one year. It’s a nice gesture to celebrate three, six or even nine months that you have “spent together” with your customers. (Image source)
These were just a few examples of how emails and SMS can be better optimized, but, based on your customers demographic data or even location, you can send them even more targeted incentives, for example:
- A new customer level that members are about to reach
In this case, you can inform customers what great features, offers are waiting for them if they collect just a few more points, and show them how they can earn those points, for example by writing a product review in your store or referring a new customer (if you’d like to learn more about membership levels in rewards programs, read this: Why tiered programs are good to build customer loyalty.)
- A customer just unlocked the next membership level
Inform your program members when they reached a new level in the program. Let them know about the new ways they have to earn points or rewards. It’s the perfect opportunity to get in contact with your customers again and give them a nice sense of achievement.
- Ask customers to write reviews on a recently purchased products
A classic way to use action-based loyalty triggers is to ask a customer who recently made a purchase to leave a review about the products they bought. This has the added bonus of making it easier for you to collect user-generated content. To encourage customers to act, you can offer loyalty points in exchange for their reviews.
Loft went further by rewarding customers with loyalty points. They basically promoted a review writing campaign in which they invited their customers to a contest. Customers could enter the contest simply by writing a review. They could increase their chance of winning by writing two reviews. Smart. In the case of automation, it can work like this: you can create a segment of review writers, send them an email invitation like Loft did.
Okay, now we’ve covered many action-based loyalty campaigns, but now let’s switch to a data-based approach. How you can send automated campaigns based on the information you’ve collected about your customers? Let’s see!
2. Lead scoring to find brand advocates
A nice feature of loyalty software is that it lets you find your best customers. Those who spend the most or those who write the most reviews for you. Now it’s a good opportunity to send them targeted emails or text messages with the following incentives:
- Referring customers
Among your top customers there are those who have a large social presence. That may mean they’re active on Instagram or share a lot of content with their friends. By tracking social shares in your store, you can easily find those customers who are the most active on social media. Send them a nice email that lets them know how cool they are, and tell them you want to honor their social activities more. Give them bonus points for referring new customers with their social shares.
- Filling out an NPS survey
What is the greatest thing about your best customers? Is it that you can ask them for their input on what satisfies them about your service and products and what you could do better? (By the way, not only those who are slipping away are worth surveying in this way). Brand advocates can help you to see how to do things better, in order to get more advocates like them.
- Saying “thank you” with a special reward
A wonderful thing about automated loyalty programs is that you can segment your customers based on any data you have about them. Let’s say your higher spender customers are those, who spent approximately $2,000 in your store in the last six months. Create a segment of these loyalty program members, and make a reward available just for them! Send an email or SMS about it to let them know about this great opportunity.
The cool thing is, you can find top customers based on any data that a loyalty program can track for you. Moreover, these customers can be segmented by the “fields” they are best in. For example, you could focus on top review writers, highest spenders, or even members who referred the most new customers for you. I can only say this: segment, segment, segment…and personalize!
At Antavo, we also let you find your best customers by letting you segment them based on several criteria, like how much they spent, how many loyalty points they’ve earned or how socially active they are on your site.
3. Cross- & omni-channel functionalities
Let me illustrate how a loyalty program can work omnichannel with an innovative example I recently found.
There is this smart taxi hailing app, Didi Chuxing, which is often considered the Chinese rival of Uber. Through this app, you can request a test drive from any car, from Toyota to Mercedes. Then, a nearby owner of the chosen car will let you have the test drive. If you liked the experience, you can purchase the model right from the manufacturer through the same mobile app. Now here’s the game-changer! After this you can also lend your own car for test drives, and if the tester makes the purchase, you’ll earn cash back.
It’s brilliant. No wonder 1.4 million test drive requests were generated in 90 days through this mobile app!
What is the most charming part of this solution?
YOU CAN DO EVERYTHING FROM ONE PLACE.
Through the mobile app you can 1) send a request for testing the product, 2) purchase the product, 3) refer another customer and 4) get rewarded for your referrals.
How can this very same logic work in a loyalty program?
- Integrate with a mobile app: Mobile wallet. Let customers use their loyalty points for offline purchases with the help of a mobile app. The app can help customers keep track of the points they’ve earned and it lets you send app notifications with loyalty special offers. These all can work by integrating a loyalty program with your existing mobile app.
- Make referrals easier: Don’t make your members hassle with complicated referral codes when it comes to inviting new customers to your shop! Let them send their invites through any device, from mobile to desktop, and let them share through their preferred channels.
Starbucks’ amazing rewards program is centered around their mobile app. With great features like a pre-load money option, pre-ordering opportunity, and the ability to earn points for mobile payment, customers are incentivized to use the app and interact with the loyalty program more often.
What’s the next level of loyalty marketing automation?
What does the future hold for us? It’s clear that loyalty marketing automation will further evolve to help companies reach the following goals: deliver a delightful and personalized customer experience on a one-to-one level, and save time on marketing activities by reducing the time required for A/B testing, as you don’t need to wait to see the results each of your campaigns THEN compare them THEN take action. AI will prioritize the campaigns that drive the best results in real-time, without the need for all that work.
For the latter, machine learning will definitely develop further when it comes to loyalty programs, by offering you loyalty offer examples that you can run email and SMS campaigns for, and automatically suggest the right communications and rewards for your customers.
I can’t wait to see what the future will bring us! (Download this post in a pdf version from below.)