Are you a loyalty company?

A version of this post originally appeared on AdAge.

It's harder than ever to earn your customers' loyalty. They are "always on," have instant access to myriad choices, and can easily find the cheapest prices from any supplier. Many companies think they've solved this with a loyalty program, but the competition is stiff there, too. On average, consumers belong to eight loyalty programs -- the majority of which are ruled by points, discounts and financial rewards. And let's face it: These transactional benefits are more about increasing frequency and spend than influencing emotional loyalty and devotion to a company.

The bad news? Traditional approaches to loyalty don't cut it anymore.

The good news? I'm not going to tell you to scrap your loyalty program. But, in my new report on customer loyalty, I am going to tell you to reframe how you think about your program. It should be treated as one of several tools -- alongside customer experience, brand and customer service -- that helps foster customer loyalty wherever customers interact.

Be A Loyalty Company, Not Just A Company With A Loyalty Program

Truly great loyalty strategies create a meaningful exchange of value between the company and the customer. This exchange encourages customers to share all kinds of profile, preference and behavioral data. And the insights derived from that customer knowledge have broad applications for all customer-facing strategies, and should radiate out across the enterprise to do the following:

  • Unite acquisition and retention marketing efforts. The insights gleaned from loyalty data -- encompassing transactions, preferences and profiles, help identify the "right" kind of new customer to attract and the types of marketing initiatives that retain existing customers.
  • Inform customer experience design. Forrester's research shows that great customer experience correlates to loyalty metrics like retention, enrichment and advocacy. But it's difficult to build differentiated experiences based on what you think you know about your customers. Loyalty insights, combined with other sources of customer data, can help customer experience teams create and deliver personalized experiences that inherently exceed expectations.
  • Develop emotionally resonant brand experiences. Today's CMOs are tasked with the uphill battle of creating brand experiences that transcend products and service transactions. Loyalty insights provide customer-centric input for brand experience development and assessment. For example, after examining the data from its loyalty program, an online retailer was able to course-correct a branding strategy that largely targeted a mercenary and high-churn customer segment.

How do you evolve your approach and treat your loyalty program as a hub for customer insights? Read my full report here.

A version of this post originally appeared on AdAge.