Loyalty is more important than ever as consumers become more selective with their spending, said Randy Limes, group director, US omnichannel marketing and consumer promotions at Mars-Wrigley.

“I think every consumer is making maybe slightly different choices, or maybe taking a split second more to make the choice [of what brand to buy] because the brand [they] know and love has gotten a little more expensive in the past few years,” he said at a recent Advertising Week New York session.

But a winning loyalty strategy isn’t just about short-term wins like lifting sales; it’s about building a long-lasting relationship and boosting customer lifetime value.

“I see more and more with our clients, they’re trying to do more than an earn-and-burn strategy,” said Melissa Berger, chief solutions officer at Digitas. “But the question is, how do you provide that?”

Here are three ways brands can build long-term loyalty and unlock lifetime value.

1. Get organized

Have a conversation with internal and external stakeholders on the program’s goals and “what you’re trying to solve,” said Limes.

Decide where loyalty sits within an organization.

• Limes, who has also worked at multibrand company Procter & Gamble, recommended that loyalty should sit centrally, not within any one specific brand or department.
• “There’s always an unconscious bias that singular brands have, but if loyalty sits centrally, it’s easy to take a true portfolio approach and make the right choices.”

2. Identify what’s valuable to customers

“The reality is, if you don't ask the customers what they want, it's not going to win,” said Berger. “It seems like such a small thing, but it is incredibly unbelievable how many brands don't actually talk to their customers.”

Berger said to check in with your customers multiple times during the development of your loyalty program. That can lengthen the time to market, but is usually worth it.

“A lot of brands want to rush through it, but that’s not going to help achieve what you’re trying to tackle. You need to make sure that the program resonates, that it’s something your customers are interested in.”

3. Let the data guide you

Ultimately, loyalty programs are meant to help brands acquire new customers and keep current ones engaged. But it can be difficult to achieve both.

“Yes, you need new households, but you need to retain and hopefully grow your existing,” said Limes. “That's marketing 101—it cannot be so unaffordable to win new customers that you're sacrificing your current customers.”

This is where brands need to lean on data to guide their investments.

• Working with rewards app Fetch, Mars Wrigley leveraged its customer data to identify which audiences to invest in and where it should pull back.
• The brand found it was spending more on trying to court new customers when it was actually more profitable to invest in lapsed customers, said Limes.
• “So we took some investment away from trying to acquire new households and found that we were able to grow lapsed households in a different way.”

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