How To Perfect Your Loyalty Program’s Engagement Loop

Apr 07 2020 12:52 PM

Every Loyalty Program Has an Engagement Loop

Every loyalty program has an engagement loop of behaviors and actions that members repeat as they rise to become your most valued customer. At a minimum, that loop is likely: spend to earn, spend to earn, spend to earn, and, finally, redeem. Then start the cycle over. If you’re in a highly competitive industry this simple kind of program may not be enough. You’ll need a stronger engagement loop; one with appeal and stickiness.

To perfect your loyalty program’s engagement loop we’re going to leverage principles borrowed from video game designers who are constantly working to improve their video gameplay loop design: Focus, Anticipation, Progression, and Appeal. Game designers use these principles, and others, to motivate behavior and improve repeat play.

Focus
Your members must know what they’re working towards and their level of progress towards that goal at every touchpoint. Provide visual and visceral focus and feedback on your members’ progress towards earning a reward. Often overlooked opportunities to provide focus include:

Associates/Customer Care interactions at the point of sale
Near reward/tier communication
Eliminating Non-Relevant Messaging. When you send communication that isn’t contextually relevant you’re weakening members’ limited and tenuous focus

Anticipation

When your brain senses that “something good” is about to happen it releases dopamine triggering incentive salience—the desire for that reward—thus creating a “motivational magnet.” This feeling of anticipation can be more powerful than the feeling of getting the reward.

Building anticipation for your members as they get close to earning “something good” is very motivating and reinforces their focus. To perfect your engagement loop, try to use these anticipation-building hacks:

Strategic use of two-step communications that tease an important event or milestone before paying off the reveal
Visual meters and bars that replay or re-fill with each new interaction
Distinctive sounds, effects, and visualizations that convey a sense of building excitement; this is often a delaying animation before the final celebration for earning a reward

Progression

As members repeat your loyalty engagement loop, the quality and value of that experience will dictate your retention rate. Try to utilize reward convexity—greater levels of spend earns greater rewards—in your program. Shopping elsewhere should feel like a loss when not earning points in your program. One-to-one promotions, personalized challenges, or a tier structure will add that sense of progression.

Additionally, the member’s progression or journey towards a purchase to earn points is just as important as the purchase itself. Game design practices would indicate that loyalty marketers should test rewarding and reinforcing the critical smaller steps along a member’s path to purchase and not just the purchase itself. Consider issuing points early on for good behaviors like:

Opening emails and clicking through on links
Logging in and browsing the website with intent
Adding items to a wish list
Trying items on in-store

Appeal

Ensure your members feel good about their experience throughout your loyalty engagement loop. If you don’t connect your brand with members on an emotional level you cannot expect them to become advocates and referrals. Forrester’s recent 2019 Customer Experience Index shows that “Elite brands provided an average of 22 emotionally positive experiences for each negative experience, while the lowest-performing 5% of brands provided only three emotionally positive experiences for each negative experience.”

Here are some tips and techniques for creating sustainable appeal:

Integrate augmented reality events, games, and shopping experiences into the member journey (I loved the 7REWARDS Deadpool and Detective Pikachu AR)
Create special member access around brand sponsored events (props to the AEO Connected member roof deck experience at Lollapalooza)
Be authentic. Curate unique member experiences that reinforce the shared brand values between your program and your members (for me, the Hilton Honors “Guitar painting & Concert with The Struts” event is all that)

TL;DR

(Too Long; Didn’t Read)

Members play your loyalty program like they play video games.
Gameplay loop articles on Gamasutra.com by Matt Allmer and Daniel Cook point the way to improving your loyalty program engagement loop.
To perfect your engagement loop:
- Help members focus by providing clear goals and continual feedback.
- Build anticipation for upcoming rewards and events with dopamine hacks.
- Reward members for important steps in the progression.
- Create appeal by connecting emotionally and being authentic.

Brierley + Partners offers a range of strategy and consumer insight modules that can help you in evaluating and enhancing your member acquisition and on-boarding efforts. Our Strategy and CI Teams can help with projects such as CX Journey Mapping, Competitor Evaluations, Communication Audits, Loyalty Ideation Workshops and more to ensure you maximize every opportunity to drive enrollments. To learn more, visit Brierley.com or contact us.

About Brierley

Brierley is the industry leader — transforming loyalty around the world. The company’s focus is turning client challenges into successful and profitable loyalty program solutions. Brierley brings together innovative thought leadership, unparalleled expertise, and advanced technologies to help brands win customers’ hearts and minds.

Brierley’s LoyaltyOnDemand® represents a powerful evolution in loyalty technology. This intuitive platform empowers everything a loyalty program demands to engage customers across every channel and touchpoint. LoyaltyOnDemand is also continuously evolving with new features to keep programs on the leading edge. In addition, Brierley offers the full breadth of services to drive unprecedented loyalty success: program design, strategy, research, analytics, customer insights, creative, and digital solutions.

Experts you can count on. Solutions you can trust. Success you can measure.

Brierley is U.S.-based and is a wholly owned subsidiary of Nomura Research Institute, headquartered in Tokyo, Japan. To learn more about Brierley, visit http://www.brierley.com/.