With roughly a week and a half before Christmas, it would be easy for marketers to feel their fates have been set. It would also be incorrect, according to Dennis Armbruster, managing partner at LoyaltyOne Consulting.
A retailer can still use its loyalty program database to identify customers who haven’t yet visited its locations, Armburster told Direct Newsline. Recency analysis, when compared with their spending level from last year, can identify high-potential segments which haven’t yet been in their stores, he said. “[Marketers] should be aggressively after them, targeting bonus offers and things of that nature,” Armbruster said.
“I would also query [the database] for those with enough loyalty program points to redeem for gift certificates or merchandise, promote the fact that they have enough to redeem, and leverage those opportunities go get them in the door,” Armbruster added.
Retailers can also examine what’s still on their shelves. If they have categories or lines they thought would move more quickly than they have, or higher-margin items which are still in their stores, they can leverage their customer information database to leverage the under-purchased product lines or categories.
Even the last strategy relies on a customer-centric approach, according to Armbruster. “It still involves doing an extract on demographic or lifestyle data, and prior purchase categories. Before we get to the post-holiday season, when everything will be on sale, why not leverage loyalty program data to marry those business needs with customer needs?”
Smart retailers will also use the holiday shopping season to generate repeat business in the first quarter of next year. Armbruster recommends offering triple loyalty points on items purchased right before Christmas. Consumers who meet specific spending thresholds can be given certificates to use in the first quarter.
“The first quarter is always soft,” Armbruster adds. “How do you take advantage of their activity now and their awareness of the program they are participating in to drive another trip in January-February-March?”
Armbruster does not overlook online channels. In fact, last-minute marketing efforts are made for e-mail messages, which can contain links to e-commerce sites. For online promotions, free fast shipping might be an additional incentive, on top of the points and the first-quarter certificate. “The reality is it could be easier to drive online traffic than to get them into the store one more time.”
Armbruster’s comments come on the heels of survey results issued by LoyaltyOne and Epsilon Targeting. According to the survey’s findings, 11% of respondents who are loyalty program participants anticipate using reward programs to stretch their shopping budgets – and of those, 70% will use their points or miles to obtain gifts for others.
Loyalty program participants are primed to spend: While only 6.6% of all consumers anticipate spending more on holiday purchases in 2010 than they did in 2009, 8.1% of reward program enrollees plan on doing so, according to the survey.
The audiences using loyalty programs are changing, and marketers should be excited about the demographic shifts. LoyaltyOne has found that the two fastest-growing participation cohorts are teenagers and young adults. This is in part because more marketers that appeal to them are offering programs, or specific strategies within their programs to appeal to these consumers.
Even marketers who have used analysis to manage traffic during the holiday season should not be resting on their laurels, Armbruster says. “The holiday season is almost over. Most marketers are into their spring lines. With that in mind, how are they using the same level of rigor and analysis for their efforts in the spring?”
