Vice President of Revenue Strategy at Margaritaville

A global pandemic in 2020 that forced the world to stay home, reshape livelihoods, realignpriorities, and learn new ways to achieve results, will go down in history as a disruptive moment in time when all commercial and service business models were changed, eliminated, or evolved, to never be the same again. Loyalty programs will be no exception.

The travel and service industry suffered a major shakedown: no corporate or business travel, no conferences, no weddings to attend, no family vacations, no dining out, no concerts, no sports, nothing. The world stood still for months. Airlines and major hotel brands rushed to protect their loyal customers by offering flexibility in purchases, waiving penalties, and extending membership benefits and status for months to ensure customers remain active members. If there was ever any doubt about the impact of loyalty programs in the financial health of a business, last year was a quick reminder of the paramount importancethese programs hold in their respective brands.

As it would be expected when the world is stuck at home, membership, and subscription services (ultimately considered paid loyalty programs) soared and thrived. It all relates to convenience and availability. Companies like Amazon and Netflix saw large growth in their ranks, while services like Instacart or Doordash became everyday utilities. None of these however, generate true loyalty, only transactions and interactions as they are solving an immediate problem related to food or entertainment. I expect these providers to go back to “normal” business levels as people start shopping in person and dining out again.

A big move on the loyalty stage came from the big box hotel brands (one specially) who used this lull time to experiment with partnerships in the consumer goods arena, leveraging their credit card members. A smart move as people were sitting at home not traveling but still spending. Another major loyalty program in the airline space raised a significant amount of capital based on the valuation of their membership data. These are tectonic changes that will have repercussions for years to come, and yet, none of these major movements will generate loyalty. Don’t get me wrong, I’m in business and I understand the need to raise capital and generate revenue in times of great uncertainty, but I refuse to call that loyalty. We need to be honest: every major loyalty program out there is out to get our money and our data. We as consumers, are paying to obtain discounts, freebies, upgrades, whatever. Loyalty as a sentiment of support, patronage and pride for a brand is a thing of the past.

The big players in the space have opted to use the consumer data as a springboard to generate revenue and establish cornerstones for new business ventures. Given the nature of that business model (whatever it may be called) they have no choice. All that aside, now more than ever, a window of opportunity has surged forbusinesses and brands of all sizes and shapes to tighten the relationship with their customers by showing appreciation and providing value for their continuous patronage. This is the time for us to reinvent and reengage true loyalty and call our customers back to our ranks! Here are my basic roadmap tips:

1. Get yourself reacquainted with your brand and value proposition. What makes you different and better than your competitors?
2. How much do you know about your customers? Do you have an email or text database? Dust it off and start planning!
3. Bring your marketing, operations, and IT teams together (even if that means you,yourself and a notebook) and plot your customer journey. Even better, WALK in your customer’s shoes for a day, identify every interaction, and take note of what’s missing, what needs improvement and what you’re doing right. Whether you have a loyalty program or not, that’s an exercise worth doing every time you’re in learning mode.
4. Based on the first 3 steps, create a plan to address the fails and slips, and another plan to up and communicate the successes and awesomeness of your brand. Put them both to work. From your misses, go down the list; fix and find efficiencies. Communicate with your customers about your improvements. From your awesome list, use examples to share with your customers and remind them why they love you.
5. As you read above, communication is key, and it can be tricky if you haven’t called in a while. Figure out what medium is more suitable based on how recent your last interaction occurred. Start with a quick “Hello! It’s been a while” type of message and maybe share a cool picture, story or meme. Make it non transactional, instead, make it conversational and offer value.
6. If this customer has visited or purchased something recently, ask how they liked their service or product, what feedback do they have and how could the experience be improved.
7. Most importantly, focus on the customer right in front of you, right now. How can you make THIS one customer’s experience better? What can you do to improve THIS experience and generate additional visits, purchases and the ultimate loyalty: Advocacy?

I realize I am writing less aboutthe technology that supports loyalty programs than you would expect, but in reflecting about the year we just left behind and the many ways in which our lives have changed, I am convinced, more than ever before, that loyalty between a business and a customer is still very much about human connection and understanding. As businesses, we must deliver experiences in such a way that our customer receives the value for what they have paid and feels connected to our product or service. But there’s no tech out there (yet) that can replace eye contact, a smiling face, a sincere apology for a poorly delivered experience or a memory making moment when we all forgot that money was being exchanged and we were just doing unto others as we would like to be done unto ourselves.