If there is one positive outcome from this pandemic, it’s the chance for us to stop, reassess and re-strategies on both a personal and economic level. For businesses it has been a frantic period of figuring out what comes next and with optimistic projections of having shops back in business by June, let us look at some best options for kick-starting our economy and honestly look at where retailers or restaurants should focus their energy?
Creating a win-win solution
Retailers and restaurants need customers to survive. However with the lay-offs due to the slowdown of the economy, customers now want more than ever to conserve cash. Customers now would reprioritise their cash flow for essentials to weather this storm. To look at this optimistically, this creates an opportunity for businesses to strategise and communicate effectively to accommodate the changing behaviour of customers.
In this climate, rewards can be used to encourage spend and give customers options to get rebates. Rewards that offer cash back or discounts create value for both parties. It’s proven that rewards programmes – especially those offering immediate benefits, like cashback or discounts – drive additional spend.
This reward strategy has proven to be successful in other economies. Looking at China; the epicentre of the crisis has now already seen major reopening of businesses as of April 8th, nearly 50 cities across 16 provinces have implemented a voucher system which shoppers or diners can redeem at various shopping, dining, travel and recreational locations. Some of these cities have committed to multiple rounds of voucher releases over the next few months as they have seen how it is working. For instance Hangzhou have seen exponential results (subsidy of 257 million yuan in coupons increased spending by 2.66 billion yuan).
Building Long Term Customer Engagement
From China’s example, rewards work when it comes to jump-starting the economy. Unfortunately these programmes often start strong and will usually see customer engagement peter out over time if it is not done well. Therefore to make sure the reward programme is DONE WELL to reap the long term benefits similarly to major brand names like Sephora and Zalora, the experience has to be frictionless, relevant and effective for both business and their customers.
To make sure your business is creating value and delightful experiences for your customers, a laser focus on customer experience is key. For instance, the reward programme not only has to be easy to use to encourage on-boarding of new customers but to serve rewards that they desire. Blanketing customers with vouchers might drive short term gains, but they will not be able to sustain your business into what is still a very uncertain future. Therefore, finding an easy and frictionless way to deliver rewards to customers is a much better bet.
Driving Change with Technology
Technology can help your business create a frictionless, relevant and effective way to deliver rewards to your customers. A mobile app makes it easy for customers to earn their rewards or points automatically and enables them to check it whenever, wherever they are. When 76% of consumers tell us that they prefer to keep track of their loyalty/reward points via a mobile app(Vase.ai); we should start listening.
De.Wan 1958 by Chef Wan; a modern Malaysian restaurant's loyalty app has an easy and secure on-boarding process for their customers (seen in the screens below). All the customers had to do is to sign up with their mobile number as an identifier and they can easily start collecting rewards by flashing the QR code to the cashier when payment is made.
By harnessing technology, brands are empowered to create rewards in a more controlled and strategic way. Relevant rewards should be targeted promotions created for customers to reduce wastage, yield better results for the bottom line and create loyalty to the brand. Another great thing you have control of is the ability to choose to offer rewards at a certain time of day at a specific location, for instance driving much needed traffic to struggling parts of your business.
For Frank Laurent Coffee Roasters, their goal was to acquire as many customers during the quarantine period. They have launched their rewards program with a “Quest” option to refer a number of friends as members with a double incentive for referrer and referee. Through this strategy, the business managed to gain new customers to boost sales especially during a very trying time.
With every transaction, a huge amount of granular customer data is generated. Retailers and restaurants can use that to get to know customers better and continue to tailor their products and services accordingly resulting in not only short term spend but develop long term loyalty.
As a franchisor, Face to Face Noodle House understood that brand loyalty is vital for the longevity of the business. In conjunction with the launch of their rewards programme, customers stood a chance to win cash prizes by participating in the Hot and Spicy Pan Mee Challenge. From this campaign, they were able to start collecting customer data which helps with business decision making including future store locations.
Another way businesses can create long term loyalty from customer data is providing them an opportunity to express their opinions and feedback. These valuable data collected from the mobile rewards programme will be utilised to better customer experience and as Bill Gates says it “We all need people to give us feedback. That’s how we improve”; and more importantly, customers feel validated and acknowledged.
We are all adapting to the new normal. As we look for ways to stimulate the local economy and drive sector recovery, smart reward programmes will be critical. To find out more about how you can harness technology and build your own version of a mobile loyalty program to drive consumer spending in your stores or restaurants; our product Campfyre could help support you as you strategize for life post-lockdown. Call or WhatsApp us at +6018 - 9722 620. You can also drop us an email at email@example.com.
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