Go Beyond Points for Retail Customer Loyalty

• Build aspirational momentum. Create simple benchmarks that reward customers at certain pre-defined levels. The easiest benchmark for both you and the customer is cumulative dollars spent within a given period of time (e.g., one year). The customer learns that if she spends X, she'll receive Y benefits. If she spends 2X, she'll receive even more rewards.
• Know who your best customers are and focus your resources on them. It's not unusual to discover that 75 percent of your profitability comes from 20 percent of your customer base. Therefore, why spend precious rewards dollars on less-than-profitable customers, when directing your budget toward top-tier customers could increase return on investment immediately? Delve into your customer data and use sophisticated modeling tools such as market basket analysis or predictive modeling to get a firm grasp on how your best customers behave or will likely behave.
• Be spontaneous and show appreciation to your best customers. Unexpected "surprise and delight" rewards can make a huge impression with your most valuable customers. Similarly, recognition is one of the most powerful yet underused benefits in a marketer's arsenal.
• Communicate. You probably have promotional communications down to a science, but what are you doing for customers that add value to their relationship with your brand? Give your customers reasons to come to you for information, entertainment and insider scoops. Give them plenty of opportunities for meaningful two-way dialogue and you'll be the one rewarded.
• Integrate your data. In today's multichannel world, retailers with integrated data across all shopping channels are prevailing. After all, your best customers are likely purchasing online, in-store, via your catalog and connecting with you via social media. Capturing all of that data gives you a complete customer profile from which you can make informed loyalty-generating decisions.

The most important advice for creating or revisiting a loyalty program? Getting a three-dimensional view of your customers, primarily through your data, will go a long way toward telling you what could make them more loyal.