Best-in-class loyalty program goes beyond traditional punch cards. There is also no one-size-fits-all customer loyalty template. The key to success is a data-based loyalty strategy that combines customer data to create unique, personalized offers, leading to increased engagement and revenue, according to András Szöcs, senior director and head of customer programs and center of excellence at a leading European retailer, Salling Group.
Speaking to Paula Thomas in her weekly podcast “Let’s talk about loyaltyAndras discussed the launch of the extremely successful Salling Group customer remuneration program.
Loyalty against the backdrop of the pandemic
As the largest retail operator in Denmark, serving over 11 million customers per week and operating in more than 1,400 retail locations, including restaurants, discount stores and grocery stores and cafes. But far from your typical customer loyalty story, the Salling Group has taken a less traditional approach that continues to pay off. This is a story you will not want to miss.
It can be assumed that the Salling Group launched its loyalty program during the pandemic in direct response to the change in consumer behavior. But Andras said it was a coincidence.
“We started refining the idea of a client program in early 2019,” he says. “This was mainly due to a big promotional transformation that I led for the Group. From this project it became clear that we need a customer loyalty program. “
Salling Group wanted to move away from its outdated scoring strategy, which uses a plastic-type token, because with COVID it has become a hygienic factor. “Apart from being environmentally friendly, it has also imposed significant costs on our P&L. We did not believe that this could really increase the value of customers in the long run, “explains Andras.
This led Salling Group to turn to Cheetah Digital to invest in a new, fully integrated digital marketing program for the entire company that was unique to each of its brands and gave customers more – more personalization, more experience and more benefits. Salling Group’s strategic days of spraying and prayer, when it delivered coupons on printed leaflets, are over.
After a series of discussions and with the support of Cheetah Digital, Salling Group decided to build loyalty program which can be used anywhere as a owned digital personalized communication channel; something that does not depend on the gardens surrounded by Facebook and Google. Moreover, the program will help the Group understand its customers outside of transactions.
Passing the “Grandma Test”
Steve Jobs tackled this when he said that users should be just three clicks away from what they want to do. And this is exactly the premise in which Salling Group has built its loyalty program with Cheetah Digital included.
Instead of asking a lot of questions when registering and building an account, the Salling Group’s loyalty program, which uses one-touch activationit just requires three things: an app download, an email address, and a payment card.
“He had to endure what I call the ‘grandmother’s test’ – if it was easy enough for my grandmother to enter, it was simple enough,” says Andras.
By focusing on providing a great and seamless customer experience by weaving digital payments, coupons and gaming into individual brand applications, the Salling Group has achieved a 10-fold increase in daily active users.
Moreover, he broke his 2020 registration targets in just four weeks. And very recently the group reached an important stage worthy of applause. “We have just reached the 1.2 million member mark,” he said. “It’s a very nice number to celebrate.”
Economical communication without cookies
As Paula points out, compared to other digital, television and marketing channels, it is incredibly profitable to have a direct digital channel to reach your customers. Moreover, with the disappearance of third-party cookies, it is now more important than ever to keep your customers close.
“With what is happening today with cookies and data privacy, the ability to engage with your customers on their terms is crucial. When they sign up for your app, they essentially say they give you permission to engage with them there. This is the most ethical way, which is extremely important for maintaining high engagement of applications, is to constantly provide them with new information, games and services, “adds András.
Salling Group recently incorporated the Neatoscan service into its loyalty application. Customers can now scan their items on their phones while shopping. When they’re done shopping, they press the pay button and then exit. No need for a queue.
“We have another feature we call digital recovery,” Andras explains. “So obviously we have digital receipts. But if you are not happy with the product when you get home, because for example you cut the avocado in half and, unfortunately, it is brown or something like that; you have the opportunity to identify the product in your digital receipt, take a photo, send us some comments why you want to restore it and then send it and we will refund your money in your digital account.
Gamification as a strategy
Remember the paper scratch cards where you take your coin and scratch the paper to reveal what you won? This is essentially what Salling Group has installed in its loyalty app. This is a game that people still love to play, even digitally.
“When they play the games in our apps, they unlock free chocolate bars or sticky bears. It’s nice, but it’s nothing special. And yet there is this huge level of commitment. From children to grandmothers, everyone wants to scratch. And that makes them return to our application, “says Andras.
Thanks to this incredible response, Salling Group is striving to build momentum by developing new, more sophisticated games. The group found that this is a very cost-effective loyalty strategy that pays off handsomely.
“Again, it’s all about simplicity,” he said. “Before, when we played games, it was an operational nightmare because we had to distribute prices, make sure the cashier had the right barcode to scan, and so on.
“This is another moment of great credit to Cheetah. The team linked experience with loyalty. Once our customers play the game and win the product, a free product coupon flies into their loyalty app. The customer can then simply take the item off the shelf and leave without paying for it. Store staff don’t even have to know we’re running a game. This was a key parameter for us to convince our people in the store to allow us to run these games. It was critical. “
For the latest global consumer sentiment and trends in personalization, privacy, messaging, advertising and brand loyalty, see Cheetah Digital’s 2022 Digital Consumer Trends Index. here.
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