Member, Engage

Here’s a good reminder, from team member Mark Shulkers, that when loyalty program members aren’t redeeming their points, you’ve got big problems. For those that haven’t been involved in loyalty programs, “breakage” is simply the number of all unspent points divided by the total number of points issued across all your members. There’s plenty that’s been written on balancing breakage and what the optimal ratio might be. Accountants have a point of view and marketers another. My personal opinion is that you should design a program to quickly earn (and achieve) and easily burn with a mixture of aspirational concepts that require a member to look at the long-term relationship with your brand, along with serendipitous moments along the journey.

As Mark points out, value of the program and it’s points or currency is assessment when the member redeems. As a marketer, we should help them redeem. Make it easy to know how and for what. Remind them of what they could do with their points. Give them short and long-term options for achievement. One of the best ideas for those that are saving points is to just give them a little extra (out of nowhere) to help them get something really cool. “Did you know if you had 100 more points you could go to this really great concert? Now you can! Here’s 100 extra points on us.”

Understand your customers and design a program that will help them earn quickly, burn easily and aspire to save for something they care about. Along the way, surprise them.