Building loyalty: the global, Customer First approach

Building loyalty with customers is nothing new. It’s an age-old method to help create an emotional connection between a brand and its customers. But, in a rapidly evolving sector, the loyalty approach is constantly changing, and grocery retailers must adapt their strategies to maintain and win loyalty in existing and new customers.

In our recent report – Defining Loyalty: How Customer First loyalty can drive success in retail - we examined how customer shopping habits have changed and how retailers can drive engagement and foster loyalty through data-driven loyalty programmes.

In our previous articles, we looked at some of the report’s findings, including key trends in loyalty and what makes a successful loyalty programme.

Our report highlights how brands must achieve a seamless customer experience across multiple touchpoints in-store and online by focusing on propositions that create personalised shopper experiences. For example, blended loyalty programmes on a single platform, such as an app, can help support customers at all stages of their digital shopping experience, while developing a loyalty ecosystem with other partners can provide additional benefits to shoppers.

Using data to personalise a loyalty programme and adding benefits beyond points, such as discounts, rewards, exclusive content, digital receipts, and free shipping, can further help to attract new customers and reinforce engagement.

In this article, we look at the importance of adopting a global, customer first approach.

Putting customers first

Failing to put customers first is one of the biggest mistakes retailers make when developing loyalty. To put customers first, retailers must understand their customers and the role their products and services play in their lives. They should consider the customer journey by exploring what customers value most and how influences like price, promotions, range, layout, marketing, service and brand impact their decision-making and expectations.

Grocery retailers must also build a plan for success that fulfils customers’ changing needs. One way this can be achieved is by creating the perception that each customer’s experience has been designed exclusively for them.

Loyalty programmes are no longer one-size-fits-all and collecting points. Successful loyalty programmes are built on science-driven customer insights, with loyalty earned by being responsive to customers’ needs. Take, for example, Esselunga, which operates over 150 superstores in Italy. Their loyalty programme, Fidaty, offers shoppers personalised offers, donations, and prize items from a catalogue, in addition to discounted cinema admission.

Local decisions, global success

Global retailers must also fine-tune their loyalty programmes for each country they operate in. Customer behaviours, data sharing and privacy laws, as well as smartphone habits vary considerably from country to country, and even more so for global brands spanning different continents.

For example, a mobile app-based loyalty programme is likely to succeed in the US, which has a mobile penetration rate of 81.6%. However, the same mobile app-based loyalty programme is unlikely to succeed in India, where smartphone penetration is just 31.8%.

Starbucks is an example of a global brand that has tailored its Rewards programme across multiple countries, adopting a localised approach to building loyalty. The Starbucks Rewards programme boasts nearly 25 million members, with the loyalty programme tailored for each country. For example, the UK has retained the ‘Gold Members’ tier, which no longer exists in many other markets.

When fostering loyalty, retailers must put customers first. They should consider the customer’s needs, pain points, and shopping journey and then organise solutions into a loyalty approach that is perfectly aligned with their brand and business strategy.

At dunnhumby, we have developed a Customer First philosophy to help our clients ensure that their retail strategies are truly customer-centric and that every decision optimises customer satisfaction.

To discover more insights on fostering customer loyalty, download the full report here.