Loyalty Programs and Incentive Programs are commonly used by creative agencies across the world to alter customer behavior. Though sometimes the differences between the two concepts can become blurred within the elements of the marketing mix, both are effective for increasing brand loyalty and customer retention.
According to research by Virtual Incentives, while price was the most important factor, 75% of customers value brands that offer incentives and loyalty programs. When choosing a company to buy from, 28% of people said customer incentives were a decisive factor.
75% of customers value brands that offer incentives and loyalty programs.*
(VirtualIncentives.com)
Loyalty and Incentive Programs both analyze user data based on purchase history to provide a more personalized experience. This helps to better understand the Customer Journey, teaching you what your customers want and what motivates them to act. This knowledge can then help you encourage customers to purchase more, often by providing personalized customer services, like recommendations based on past behaviors.
Incentives are now such a common and successful practice, it’s to the point that customers expect to receive communications and incentives for their business. A survey by Vibe found 61% of consumers only enable mobile push notifications for loyalty program incentives.
So creative advertising agencies should consider both elements of the marketing mix to open new doors for communication with customers and help generate loyalty among the target market.
There are many types of incentives, but we recommend focusing on these four to help ad agencies drive leads for products and services. Your starting point is doing everything you can to understand your target audience as much as possible, and then segment that audience accordingly.
This will greatly aid your incentive program when you’re looking to provide a personal customer experience. In turn, this will also boost customer satisfaction and loyalty.
The best offer may vary between traditionalists, Baby Boomers, Gen X, Millennials and Gen Z.