NEWSROOM eMarketer's latest news, announcements, and media resources.

Social Loyalty Programs Reward Customers and Retailers Alike

eMarketer analysis suggests several steps for successful marketers

NEW YORK, NY (June 28, 2012)—The ability to combine traditional loyalty programs with social media holds great promise for retailers and brands trying to strengthen retention, says a new report by eMarketer. But there are several key steps retailers must take in order to be successful—or they’ll risk simply becoming another forgotten “like.”

The new report, “Social Loyalty: From Rewards to a Rewarding Customer Experience,” analyzes findings from dozens of third-party research providers and interviews with industry executives, outlining several best practices for marketers looking to improve customer loyalty.

Why? Because many traditional loyalty programs are not highly effective, eMarketer notes. While loyalty programs have been popular in the US for years—with the average American consumer belonging to 18 loyalty programs according to loyalty marketing publisher COLLOQUY—whether these members are active is another story.

“Points, coupons and freebies are great for grabbing initial attention,” eMarketer says. “But in the long run these promotions can’t make up for a lackluster customer experience. Through the use of social media, retailers and brands can identify and interact with the most profitable internet users.”

The full report examines the benefits social loyalty programs provide consumers and brands, as well as the challenges they create for marketers.

“Loyalty can be won through encouraging word-of-mouth and creating advocates, by raising a user’s social status, by surprising and entertaining shoppers in unexpected ways and also by listening to customers’ needs and suggestions and responding in a mutually beneficial fashion,” eMarketer says.

Key Takeaways from “Social Loyalty: From Rewards to Rewarding a Customer Experience”:

  • Brands that most often succeed typically encourage sharing, raise customers’ social status, develop highly entertaining loyalty programs, and listen and respond to feedback quickly.
  • Loyalty programs are only as effective as the overall 24/7 customer experience.
  • Using social media as part of a loyalty strategy is still a relatively new practice. Many brands and retailers are testing the waters and attempting to add a social layer to an established program while building upon already proven principles of customer relationship management.
  • Social loyalty programs provide brands with an unprecedented amount of customer data, but turning that abstract information into meaningful results is a challenge.

Major challenges for loyalty marketers addressed in the report include:

  • Data overload
  • Customer segmentation
  • Measurement
  • Privacy and permissions

About eMarketer
eMarketer is the authority on digital marketing, media and commerce, offering insights essential to navigating the changing, competitive and complex digital environment. By weighing and analyzing information from different sources, eMarketer provides businesspeople, marketers and advertisers with the most complete view of digital marketing available.
www.eMarketer.com

Media Contact:
Clark Fredricksen
Vice President, Communications, eMarketer
Tel. 212-763-6056
Twitter

Posted on June 28, 2012.