RL Pro Exclusive Q&A: Real-time and Next-level Loyalty Insights

Pro Tip: Loyalty continues to be a difficult concept to navigate within retail as consumers grow their mission-driven shopping behaviors and focus on how retail can work best for them. Loyalty programs need to solve the problem of “what’s in it for me?” for consumers in order to create a lasting change in behavior. Making loyalty fun, engaging and competitive is key. It’s easy to say that any loyalty program that helps consumers save money in today’s financial climate will resonate — and to a large degree, that’s true. Consumers are looking to join loyalty programs to save money against rising prices. ASDA in the United Kingdom, for example, launched its first-ever loyalty program in August 2022, which focused on providing cash savings and very quickly had more than 1 million members engaging with the program. But many consumers have a more profound desire to connect with a retailer’s loyalty program because they provide value that exceeds everyday savings. They seek to make their customers’ lives better and easier. Retail Leader Pro (RL Pro) talked loyalty and how tech is pushing it forward with Tim Mason, Eagle Eye’s CEO, below. RL Pro: What kinds of retailer loyalty programs resonate with consumers? Why do you think this is? Tim Mason: The technology that powers many loyalty platforms is hitting its stride, enabling retailers to offer loyalty members deeply personalized content that extends beyond just promotions and rewards. Location-based data combined with purchase history data, loyalty data and external insights, like weather or seasonal events, can be integrated to deliver contextually relevant content to loyalty program members in the moment, providing a brand-customer experience that surpasses a simple offer or promotion. I believe this — what I call “Marketing in the Moment” — is about to transform retail marketing. For example, a food retailer can send a mobile notification while a shopper is in the produce department that shares information on the organic farming practices of a tomato they’ve previously purchased. Additionally, the retailer can send a notification about store hours changing for the holidays while a consumer is browsing a website at home. Consumers are looking for more when they sign up for a loyalty program than rewards and savings – they want a deeper relationship with the retail brand they patronize. New loyalty technology is helping retailers deliver that. RL Pro: Do you feel that retailers are well aligned with shoppers currently? If not, where can they improve channels of communication? Mason: Retailers that invest in understanding their customers through full-function and data-rich loyalty programs continually work to align with customer wants and needs. Those that don't have this insight into customer behavior are at a disadvantage, which is why many retail businesses that traditionally focused on everyday low prices have recently moved into the loyalty space. The customer data is just too valuable. The relationship between data, insight, action and loyalty – the DIAL methodology established by Tesco and dunnhumby – is vital for retailers to understand and enact. With access to customer data generated by loyalty programs, retailers gain the insight they need to put personalization into action through tailored communications and offers, which drive more customer loyalty. The significant improvement in terms of offers, customer communications and loyalty will be providing a consistent and cohesive customer experience across all channels and activating “Marketing in the Moment.” RL Pro: Your reporting covers the next evolution of retail consumer engagement. How can retailers interact with customers in a personalized and contextually relevant way to influence purchasing decisions at the optimum time? Mason: Traditional personalization requires customer data and content. “Marketing in the Moment” introduces a third “C” word – context – to create a new level of personalization that delivers unique, tailored messages and offers to each loyalty member when they’re most likely to engage with that content. That’s the goal, and there are myriad ways to execute this. But they all boil down to integrating what a retailer already knows about a customer — purchase history, preferences, dietary requirements, other members of the household, etc. — with other contextual data points like real-time location, an upcoming rewards threshold, time of day/day of the week, local and seasonal events, and ensuring they can act on that understanding. Knowing where that loyalty member is (on a train two miles from a store), what they’re doing (on their phone browsing recipes), and what they care about, a retailer can deliver a piece of content in that most influential moment. In this scenario, a retailer can send an offer via phone for chicken breast in a recipe — and it can be accessed in real-time, loading items to a shopping cart and immediately updating reward points and status. If not a promotion, a message can be about a new way to recycle packaging or a notice that they’re three purchases away from hitting their next rewards goal. RL Pro: What are some retail loyalty program trends to watch for in the new year in response to evolving marketplace dynamics – including inflation, shifts in consumer purchase behavior (across both product tiers and sales channels), and demand for greater personalization and real-time offers? Mason: Real-time loyalty is a trend to watch, where loyalty members see instantaneous updates to their programs after buying online or in-store or instantly receive rewards after shopping. Some programs leverage this capability today, and it’s a great example of how loyalty is becoming more convenient and engaging. Another retail loyalty trend we’ve seen become more widespread recently is member pricing. As inflation and cost of living concerns force shoppers to be more cognizant of their spending, exclusive discounts available to loyalty members have increased in popularity. Tesco’s Clubcard pricing is an excellent example of this as is Walmart’s fuel discount for loyalty members. What will be interesting to watch will be the proportion of businesses that provide published cost savings for all loyalty members, like the Tesco model, vs. those that choose to go down the personalized pricing route, calculating specific discounts for individuals on the products that matter most to them, a model that Sainsbury’s in the United Kingdom launched at the end of 2021. RL Pro: How can retailers take their digital marketing and loyalty programs to the “next level” in 2023? Mason: Again, it’s challenging themselves to create content that meets their loyalty members in the moment. This is the missing piece in loyalty and personalization that retailers can use to bring their programs to the next level. It’s accessing data that builds the most effective promotion and offer for each loyalty member when and where they’re shopping. It’s also about getting creative and innovative in the types of messages retailers deliver to their customers and members that build deeper relationships. Of course, all of this is contingent upon retailers connecting data in actionable ways; they’ve already made great strides in capturing consumer data and gaining insights into their customers’ behaviors. But to take their marketing and loyalty strategies to the next level, they need to harness the power of that data and those insights to generate resonant offers and communications that activate customers in the moment. With those capabilities, retailers can spend 2023 building relationships with their shoppers that consistently deliver value beyond discounts and yield sustainable revenue and market share benefits. About Tim Mason, Eagle Eye’s CEO Tim Mason joined Eagle Eye as chairman in January 2016, moving to CEO in September 2016. Tim has more than 30 years of experience in the grocery and retail industries and a strong background in strategic marketing and customer loyalty. Previously Tim was a managing director at Sun Capital Partners and is currently a non-executive director at Gousto. Before that, he was deputy CEO at Tesco from January 2010 to December 2012. He held several other roles within the Tesco Group, including CMO for Tesco and CEO of Fresh & Easy LLC. While at Tesco, Tim was instrumental in creating Clubcard, Express, Personal Finance and Tesco.com. Tim published a book, “Omnichannel Retail – How to Build Winning Stores in a Digital World,” which was shortlisted in the Business Book Awards 2020.