Beyond Transactions: How Marketers Can Use Payments to Drive Loyalty
The phrase “loyalty is fleeting” always gives me a chuckle. I hear marketers and businesses regularly use it when discussing frustration about how their rewards and incentives are underperforming, customers aren’t engaged and acquisition efforts are falling flat. But the old adage is just that—old. Today, there are resources at marketers’ fingertips that can create long-lasting loyalty and help drive ongoing relationships with existing, new and prospective customers. And one of the most valuable avenues for driving loyalty is often overlooked: payments.
Here’s a marketing tip: use payments to support your reward and incentive programs. As marketing noise continues to increase, placing your rewards and incentives in an experience that your customers can’t skip or avoid (paying) ensures your efforts won’t go to waste.
Payments often get pigeonholed as transactional parts of peoples’ lives that have nothing to do with marketing. But they’re not just a one-and-done experience that ends at the point of sale. Instead, they have become valuable experiences marketers can employ to create lasting, personal connections between consumers and brands. And modern digital payments applications can embed rewards and incentives into the process for maximum impact.
Here’s how marketers can marry rewards with payments in a meaningful way:
Putting points to good use.
It makes me cringe to think of how many points I have sitting around in various reward programs—largely because I can’t redeem the points the ways I want. Forcing me to choose from a stale merchandise catalog or from a limited selection makes me question whether it’s even worth earning points in the first place. The next marketing frontier is enabling rewards to be used as a practical and broad currency. According to our research, 60 percent of consumers surveyed find the idea of using loyalty and reward points to pay for something appealing. By letting people pay with points, you can increase the likelihood rewards will actually get used and drive intended behaviors.
Accepting points as payments in-store, online or via mobile wallet provide options to appeal to everyone and helps take the guesswork out of loyalty reward selection. As a bonus, accepting points as payment can funnel spend back into your business. Your loyalty program members are a captive audience, and you can keep their attention by engaging them frequently and helping them actually use their points.
Creating digital solutions.
Digital payments are at a tipping point as a result of the pandemic driving record traffic to online and mobile shopping channels. We have found that 88 percent of shoppers surveyed now use a digital wallet of some kind and 78 percent of people surveyed plan to keep their pandemic-driven shopping habits for the long haul.
Marketers that weave digital-friendly rewards and incentives into the new habitual payment process will have an advantage. Digital payments connect people with your brand no matter where they are and enabling your rewards and incentives for digital delivery and redemption are particularly effective and timely ways to create customer “stickiness” and lasting engagement since they are always within reach. Digitally enabled rewards can be redeemed in-store, online or via mobile, and this versatility provides people with ample flexibility to suit their shopping habits as they evolve or depending on the situation. Having my rewards handy increases the likelihood they get used—making me feel a greater affinity toward those brands, adding touchpoints, and driving regular engagement.
Opening the door for future marketing opportunities.
Effective rewards and incentives can provide marketers with high-value touchpoints after point-of-sale.
By incorporating rewards, incentives and loyalty points into the checkout process, marketers can gather data consumers willingly provide to inform future strategy and tailor customized promotions and offers on an individual level. Whether it’s asking shoppers to sign up for a loyalty program, asking them to share their email address, offering an incentive for downloading your app or rewarding customers for making certain purchases with your brand within your mobile wallet, these actions can generate long-term dividends. They can also open the door for cross- and up-sell offers that attract new customers, increase the value of existing customers and increase basket size—optimizing ROI over time.
Like many consumers, I find cookie-cutter promotions to be mediocre motivators and tend to overlook them. But when I receive tailored marketing offers right in the checkout process, I’m more likely to interact with and shop from the brand that took the time to understand my wants and needs. If I have to check my email or download a different app to access rewards, my enthusiasm wanes.
Everyone makes some type of payment almost every day. There’s no way to circumvent the process.
Smart marketers that weave their incentives and rewards into the payment experience open communication channels and deepen connections between their brands and consumers. But without modernization, the incentives marketers incorporate into their reward mix may come up short. You can lean on payments to optimize your programs and create positive brand interactions that drive reward value and loyalty, engagement, foot traffic, and sales now and in the future.
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