What: An opinion piece on the need to reconsider how loyalty is seen and managed in retail.

Why it is important: Retailers have to think of themselves as audience managers, and develop their own ways to capture and retain their customers’ fascination

In the midst of a volatile retail landscape, customer loyalty is being intensely challenged. Accenture’s recent survey highlighted that 85% of consumers are currently dealing with uncertainty. This, combined with price inflation, is influencing consumer behaviors, leading to the necessity for retailers to reimagine their loyalty strategies.

While many retailers are still emphasizing discounts and promotions, leveraging data analytics can enable hyper-personalized offers. However, loyalty should encompass more than just discounts; it’s essential to meet consumers’ broader expectations such as product variety, convenience, swift deliveries, and excellent customer service. Retail subscription services are becoming popular, with some viewing them as the new form of loyalty.

It’s essential for retailers to focus on understanding individual consumers, simplifying their shopping experiences, and offering memorable interactions. There are emerging examples of this, such as the British menswear brand, Percival, that provides exclusive engagements with its top customers. Another opportunity lies in offering hyper-personalized advice tailored to health and wellness goals in grocery retail.

Brands like Best Buy are shifting loyalty from just purchases to broader brand engagement. Gamification is another method to deepen customer connection, rewarding them with exclusive offers and experiences.

Successful loyalty strategies rely heavily on data and analytics to provide a tailored experience. While technology is crucial, human touchpoints remain indispensable in shaping loyalty, with frontline workers translating brand ethos into tangible experiences.

In this uncertain period, retailers need to be innovative, focusing on a broader range of consumer needs and building strategies beyond traditional loyalty programs. Emphasizing comprehensive brand narratives, personalized offers, and genuine human interactions can guide consumer loyalty into a new era.

Reinventing retail loyalty