Mission: Loyalty — Build Trust and Incentivize Data Sharing With Your Loyalty Program

I thought that being a Secret Agent would convince people to open up and share their personal information with me. It turns out it’s not that easy…people have grown more sensitive regarding their personal information, in fact, 64% feel like their data is less secure now than it was a few years ago. 

In order to collect necessary insights and build trust-based relationships with their audience, brands need to be increasingly respectful and transparent, but also strategic and efficient. Incentivizing data sharing in loyalty programs could provide a brilliant solution for collecting invaluable zero and first-party data, while rewarding customers for their actions, making it a win-win situation all around.

Why Incentivizing Data Sharing Is Important for Brands? Let’s Take a Closer Look From Both Sides!

First, we must explain why sharing data is in both parties’ best interests. When this topic comes up, we often hear about how it benefits the company, but less so about what added benefits it holds for the customer. So, in this section, let’s take a quick look at why it’s important for both sides to share/obtain as much consensual data as possible:

• From the company’s side: Power truly is knowledge when it comes to your target audience. More information leads to more precise targeting, more optimized content, a higher level of personalization across your entire marketing process, and a better chance to connect on an emotional level as well. All of which leads to increasing sales opportunities and better ROI.
• From the customer’s side: When conceptualizing your marketing strategy it’s always encouraged to put yourself in your customer’s shoes and ask yourself what they gain by completing an action. As a customer, first of all, you would want a value exchange for completing said action of giving out your data, plus offers and rewards that are customized to your needs. Look at it this way: if you wear size XL you don’t want a size M shirt advertised to you, if you’re allergic to peanuts you don’t want snacks with that ingredient, if you have oily skin you want skincare product recommendations for that specific issue. By providing data you enable the company to get to know you, and your preferences, and then provide customer experience tailored to you specifically. 

The Biggest Concerns Customers Have About Giving Away Their Data

Despite the clear benefits listed above, customers are still concerned about data privacy. In many cases, rightfully so. Here are the main issues you should prioritize as a brand to always clarify and handle in a law-abiding and transparent way, to alleviate your customers’ concerns regarding data handling: 

• Privacy issues: How do companies actually track customers’ actions? What type of data is collected? How is it stored and for how long? 
• Data usage: What happens with the data customers agree to provide? How exactly is the company going to use it? Why should they consent in the first place? What do customers gain (besides ad pop-ups?) 
• Giving away their data to other companies: Who gets access to the provided data? Will it be sold – undisclosed – to marketing agencies, telco companies, or any other third-party members, who can use it for their own goals? 

What Do Loyalty Programs Have to Do With Trust and Data Sharing?

In light of everything we’ve shared so far, the question presents itself: What is the best and most beneficial way to build trust and collect invaluable insights in a way that satisfies the interests of both parties? Most often, bands collect zero- and- first-party data using surveys, questionnaires, feedback forms, or customer profiles. But many customers skip these, either because they dislike sharing their information or simply don’t want to spend the time doing so. So what’s the solution?

It’s important to realize that loyalty programs are a tremendous source of zero- and first-party data. Businesses that lean into direct marketing through digital channels know that, in the context of the data privacy changes, they can gather really good data from their customers through loyalty programs.

Brian Walker

Co-Founder & Principal of StrategyēM

How Do Loyalty Programs Collect Data? Do Loyalty Programs Give You a Data Advantage?

Loyalty programs are a great way to capture zero and first-party data and a great excuse to use that data in your communications and create a more relevant experience for customers, which should be a top priority for every brand Let’s see how loyalty programs can help you collect customer data in the right way:

• First of all, loyalty programs serve as a gateway to data sharing. In order to become a member, customers have to consent to providing valuable information, such as socio-demographic data and preferences.
• Secondly, member activity is another source of information that can be used for segmentation and personalization. A list of top-tier loyalty program members is a great indication of who your most valuable and loyal customers are.
• Lastly, loyalty programs allow brands to reward their customers for sharing customer data through incentivized surveys or user profile completion. These are valuable sources of information about loyalty program members, and rewards make them a more engaging part of your experience.

3 Ways to Incentivize Data Sharing in Loyalty Programs

In turbulent times, especially, customer trust is paramount, and, fortunately, loyalty programs are a great way to use your customer data to create a more relevant experience that will strengthen customers’ trust in your brand. Use this opportunity to create more personalized communication and show your loyalty program members that you’re listening to their feedback, and genuinely care about their preferences.

#1 Capture Data Creatively – Make Data Sharing a Fun Experience Through Profile Completion and Surveys

One of the main ways companies collect zero-party data is during registration, or, potentially, in the user profile area, once enrollment is finished. The rule of thumb is to ask as few questions as possible on the registration form so that the initial experience doesn’t turn people away. By getting only the essentials (name, email address, and location, for example), you can prevent impatient customers from leaving and ensure higher enrollment rates. Of course, once those customers are a part of the program, you’ll have the possibility to ask away.

Obtaining customer data through surveys is a great way to get additional, valuable customer data, including product preferences, hobbies, opinions about your brand, lifestyle, favorite brands, and so on. Surveys also deliver direct feedback from customers, which, along with first-party data, can help you optimize personalization.

Why it works:

• Upon enrollment only ask customers questions that you truly need the answers to. Then, once you have customers in your loyalty program, incentivize data sharing by rewarding them for telling you more.
• Instead of asking a list of bland questions, make surveys feel more like a game; for instance, using a like/dislike format or content that features images. This will make your surveys more fun and encourage customers to keep sharing.
• Ensure that new customers make an effort to fill out their profiles completely by offering bonus points (or other personal bonuses) when they reach 100% completion.

#2 Be Transparent – Tell Customers Why You Need More Data and What Benefits You Will Provide for Them

Incentivize data sharing by offering benefits. Build trust by being transparent about why you’re collecting data and make sure you’re clear about what customers will receive for giving you their data. If customers feel like they are not getting value, there’s no reason for them to participate.

Delivering personalized loyalty offers takes time, as you need to evaluate the data properly. That’s even more difficult when your loyalty program has just launched. So, offer bonus points for the zero-party data you need, and make sure members can spend their points on something meaningful, like experiential rewards. Even though the direct reward for completing a survey is unremarkable, the prospect of getting closer to a desirable benefit — such as early access, members-only products, or VIP rewards — will make the extra effort feel worthwhile.

Why it works:

• Create a table of the benefits or showcase the tiers. Highlight the benefits current members already have access to and the rewards they can get in return for sharing additional data.
• A loyalty program welcome email can be much more relevant and actionable. For example, tell new members that their profile is 20% complete, and let them know they will receive ‘free’ benefits for completing their profile and answering questions about their preferences.
• Add a little mystery to your surveys by giving members a surprise gift upon completion.

#3  Deliver on Your Promises – Use the Data You Asked for to Provide Real Value for Your Loyal Customers

These days, customers have more expectations, and with so many choices available to them, a bit less patience. That’s why brands need a complete view of their customers to be able to offer meaningful, relevant rewards. This is especially true in the case of Gen Z customers, who are always on a lookout for more personalized experiences that are meaningful.

While 60% of Gen Z and 60% of Millennials are willing to share personal information with a brand in exchange for a more personalized shopping-related experience, that doesn’t mean that privacy isn’t important to them. So consider strategies to protect customer privacy in order to foster trust and transparency.

Keep in mind that once you have more customer data, you need to use it wisely and responsibly. Always make sure that when you ask customers to go through the trouble of telling you more, you aren’t just advertising the benefits of relevant communications, but you’re truly delivering them. The whole point of data is relevance.

Why it works:

• Send personalized offers. Customers are more likely to share personal information and shopping preferences if there is a meaningful and relevant reward in sight.
• Make sure that the content of your messages is relevant to the given customer and that you send it at a time that is convenient to them.
• Send automated emails and messages to customers when certain triggers are activated. For instance, surprise and delight customers by sending a special offer email on their birthday.

Antavo’s Technology In Action: Here’s How You Can Encourage Data Sharing Through Antavo’s Features

As we’ve established, loyalty programs offer a straightforward, and efficient way for companies to obtain customer data. Here are the main solutions you can incentivize data sharing in a loyalty program powered by Antavo:

• Profile completion: While minimal profile fill-out is part of the initial sign-up process, with our clever features you can encourage and reward customers to complete their entire customer profile. Whether you offer a single reward for the entire process or several rewards for each profile segment, customers will feel much more comfortable with the process, seeing how they receive true value for their actions. Segments may relate to sizing (fashion), skin concerns (beauty), shopping habits (grocery stores).
• Survey: Using this function you’re able to look into variables regarding customer preferences, buying habits, and loyalty program usage. The information gained through surveys provides you with relevant, current knowledge, and should be repeated every 3-6 months in order to truly highlight important trends in customer behavior. 
• Gamified profiling: With this feature, you’re able to obtain both general and changeable information from date of birth to actual product preferences, which helps you in further customizing your reward structure, but could also be useful to tailor your entire product line based on actual customer preferences.

Trust Must Be Earned

Having a loyalty program in itself provides more touchpoints and a greater amount of first-party data to collect and leverage. This rich layer of loyalty data can be infused with your marketing activities in a number of ways, and with zero- and first-party data becoming the only source of reliable information, you need to ensure that there is proper motivation and communication behind it. With the right strategy, you’ll make customers feel secure and happy to share even more.

If you need assistance in making your loyalty program ideas come to life, our experts are more than happy to discuss the possibilities. Feel free to book a demo or include us in your RFP.

Last but not least, watch this episode of Mission: Loyalty – if you haven’t already. 

Jessica Mizerak

Jess is a Loyalty Program Analyst and a Certified Loyalty Marketing Professional - CLMP, helping companies learn more about customer retention strategies, so they can launch successful loyalty programs. She has been writing about loyalty since 2016. Jess also enjoys ballet, travel, learning languages, and carrying out secret missions for loyalty intel.