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Elevating Loyalty Beyond the Transaction

Achieving loyalty feels a bit like the process of alchemy, a complicated balance of tangible and emotional benefits aimed at capturing the hearts and wallets of customers on an ongoing basis. While tying individual spend to timely rewards is still very much at the core of the modern loyalty program, the changing expectations of consumers and the two-way nature of the digital and social marketplace now enable so much more.

Customers increasingly see their brand relationships as extensions of themselves and communities with shared values and passions to take part in. As such, ideas of personal ownership and membership are natural extensions of loyalty. They want to belong, be recognized and contribute to a favored brand’s lasting success. It’s no longer enough for consumers to be rewarded for their transactional value. In the more expansive landscape of loyalty, consumer value is captured in their ability to advocate, offer expertise and be their aspirational selves. In this more elevated space, the perks must deliver commensurate benefits, favoring exclusive access, expedited service and meaningful influence, in addition to monetary compensation.

For their part, retailers and brands are getting hip to the business value their most loyal customers provide beyond increased sales and data in a spreadsheet. They now champion their top fans as ambassadors and collaborators and their approach to loyalty programs reflects that recognition. They’re investing in platforms that do a better job of tracking a wider array of customer activity outside of just total spend (think social media shares and community posting). Companies are also considering more ways for members to get involved from affiliate sales to feedback on the latest R&D. Taken as a whole, this more comprehensive model of loyalty is building stronger connections, while simultaneously generating more value for businesses, their partners and their customers.

In this report, the PSFK team explores seven trends that define customer loyalty today, bringing them to life with leading examples of innovation from the marketplace.