Mobile apps are helping retailers enhance customer loyalty

As the retail industry begins to recover from economic instability, customer loyalty applications and CRM innovations become the key drivers of retailers’ go-to-market strategies.

In a recent report, it was found retailers are assessing their CRM technology and loyalty schemes to deliver an immersive shopping experience.

A related consumer survey on CRM and loyalty found that the top 3 customer expectations from loyalty programs include transparent management of loyalty programs, access to special services and personalized promotions, and access to a wider range of products matching personal preferences.

These findings confirm retailers’ attention towards integrating their current CRM with the latest technology innovations to enhance the overall customer experience and increase business benefits generated by loyalty.

Innovation is the basis of this retail transition from traditional reward schemes to an omnichannel loyalty transparency. In order to address consumers’ expectations and add value to the “earn points to redeem” schemes, it is imperative to look at loyalty management within its wider ecosystem.

The report highlights that retailers must identify the right approach to implement innovative loyalty schemes. For instance, multi-retailer loyalty schemes have become a successful example of partnership among several retailers.

Key findings of this study show that:

  • Loyalty is moving beyond points and discounts to become an integral part of a more encompassing customer experience that will support same-shopper sales and gain of market share to increase or recover competitive advantage.
  • Omnichannel retailers use insights to identify and understand a core group of most valued customers. From there, they can predict what might motivate changes in shopping behavior that will make them even more loyal.
  • Mobile loyalty applications represent an element of innovation that meets customer’s demand for real-time, profile-relevant, and location-based information. Along with existing mobile loyalty card apps, allowing customers to be recognized, receive personalized offers and earn points, “first mover” retailers are taking into consideration the current opportunities represented by near-field communication (NFC) technology, which enables contactless payments through mobile devices.

The mobile targeted retailing and rewarding approach is most likely what customers expect from a leading customer-centric retailer. I believe that the ability to create and foster loyalty, enhanced by the delivery of new services, is the key issue for retailer to obtain repeated and long-term customer engagements.

With better insight into demand dynamics and customer behavior provided by loyalty applications, retailers can measure the real increase of customer retention, providing an opportunity to drive repeated, larger, and more profitable customer transactions. Retailers must choose the loyalty management applications that deliver higher flexibility, scalability, and responsiveness to optimize the customer experience.

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Ivano Ortis is the International Head for IDC Retail Insights. Ivano has developed extensive insight into the ICT and telecommunications value chain and a strong market experience in understanding how to merge industry dynamics, business requirements, and technology trends to provide vertical-specific strategies on IT demand from both the end-user and vendor perspective. Prior to joining IDC, Ivano worked with Fiat Telematic Services as a program manager, Nokia as a technology sourcing manager, Vodafone as an enterprise sales engineer, Andersen Consulting as senior analyst and Intersil as an IT consultant. During 2003 and 2004 he also actively participated in the SIP Forum Marketing Working Group. He has a masters in telecommunication engineering from the Politecnico University in Milan.