Can your customer loyalty program pass the “grandmother test”?
A top-notch loyalty program goes far beyond the traditional “point-of-purchase punch cards”. Nor is there a single customer loyalty model. According to András Szöcs, Senior Director and Head of Customer Programs and Center of Excellence at Europe’s largest retailer, the key to success is a data-driven loyalty strategy that combines customer data to create unique and personalized offers, leading to increased engagement and revenue. Salling Group.
Talking with Paula Thomas on her weekly podcast “Let’s talk loyaltyAndrás spoke about the launch of the Salling Group’s highly successful customer rewards program.
Loyalty against the backdrop of a pandemic
As the largest retail operator in Denmark, serving over 11 million customers per week and operating in over 1,400 outlets including restaurants, discount stores, grocery stores and cafes. But far from your typical customer loyalty story, Salling Group has taken a less traditional approach that continues to pay off big. It’s a story you won’t want to miss.
One would assume that Salling Group launched its loyalty program during the pandemic in direct response to changing consumer behavior. However, according to András, this was just a coincidence.
“We started refining the idea of a client program in early 2019,” he says. “It was basically triggered by a major promotional transformation that I was leading for the Group. From this project, it became clear that we needed a customer loyalty program. »
Salling Group wanted to move away from their outdated point collection strategy which used a plastic type token because with COVID it has become a hygiene factor. “Apart from being environmentally unfriendly, it also had a significant cost on our P&L. We didn’t think it could actually drive long-term customer value,” András explains.
That’s why Salling Group turned to Cheetah Digital to invest in a new, fully integrated, company-wide digital marketing program unique to each of its brands and giving customers more personalization, more experiences and more benefits. Salling Group’s days of spray-and-pray strategy where it handed out coupons on printed flyers were over.
After several discussions and with the support of Cheetah Digital, Salling Group decided to build a loyalty program that could be used anywhere as a personalized digital communication channel; something that didn’t depend on Facebook and the walled gardens of Google. More so, the program would help the Group understand its customers beyond transactions.
Pass the “grandmother’s test”
Steve Jobs understood this well when he said that users should never be more than three clicks away from what they want to do. And that’s exactly the kind of premise on which Salling Group built its loyalty program with Cheetah Digital.
Rather than asking a lot of questions during registration and profile creation, Salling Group’s loyalty program, which leverages one-touch activationsimply requires three things: an app download, an email address, and a payment card.
“He had to pass what I call the ‘grandmother test’ – if it was easy enough for my grandmother to connect, then it was easy enough,” András says.
By focusing on providing an excellent and seamless customer experience by integrating digital payments, coupons and gamification into individual branded apps, Salling Group increased the number of daily active users by 10 times.
Additionally, it surpassed its 2020 loyalty check-in goals in just four weeks. And just recently, the Group took a major step worthy of applause. “We just hit the 1.2 million member mark,” he says. “It’s a very nice number to celebrate.”
Cost-effective, cookie-free communication
As Paula points out, compared to other digital, TV and marketing avenues, it’s incredibly cost effective to have a direct digital channel to reach your customers. Plus, with third-party cookies gone, it’s more important than ever to keep your customers close.
“With what’s happening today with cookies and data privacy, it’s critical to be able to engage with your customer on their terms. When they sign up for your app, they’re basically saying they allow you to interacting with them there is the most ethical and essential way to maintain high app engagement is to constantly introduce them to new information, new games and new services,” adds Andras.
Recently, Salling Group integrated the Neatoscan service into its loyalty application. Now customers can scan their items on their phone while they shop. When they’re done shopping, they hit the checkout button and then walk out. There is no need to queue.
“We have another feature, which we call digital reimbursement,” explains András. “So obviously we have digital receipts. But if you are not satisfied with the product when you get home, because, for example, you cut the avocado in half and, unfortunately, it is brown or something; you have the option to identify the product on your digital receipt, take a photo, send us feedback explaining why you want to refund it, then send it and we will return the money to your digital account.
Gamification as a strategy
Do you remember paper scratch cards where you collect your coin and scratch the paper to reveal what you have won? This is basically what Salling Group installed in its loyalty app. It’s a game people still love to play, even digitally.
“When they play the games in our apps, they unlock free candy bars or gummy bears. It’s nice, but it’s nothing major. And yet there is this huge level of commitment. From children to grandmothers, everyone wants to scratch. And that keeps them coming back to our app,” says András.
Thanks to this incredible response, Salling Group is looking to continue its momentum with the development of new, more complex games. The Group has found that this is a very profitable loyalty strategy that pays off big.
“Again, it’s all about simplicity,” he says. “Before, when we were running games, it was an operational nightmare as we had to distribute prizes, make sure the cashier had the right barcode to scan, etc.
“This is another point where we give huge credit to Cheetah. The team has linked experience with loyalty. Once our customers have played the game and won the product, a free product coupon flies in their loyalty app. The customer can then just take the item from the shelf and walk out without paying for it. Store staff don’t even need to know we’re running a game. This was a key setting for us to convince our store employees to let us run these games.
For the latest global consumer attitudes and trends around personalization, privacy, messaging, advertising and brand loyalty, check out Cheetah Digital’s 2022 Digital Consumer Trends Index. here.
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