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Building a strong loyalty program in beauty

20 Aug 2019 / By: Hanna Ryngmark

In our most recent loyalty research Kantar found that attaining consumer loyalty is a continuous challenge for suppliers facing a multitude of external factors in their attempts to understand complex drivers behind shopper decision-making.

At the same time, new data insights are increasingly being leveraged as the tool for shifting retail from habitual loyalty to genuine loyalty. We are now in a digitised world where shoppers expect personalisation, convenience and competitive pricing. This means functionality, service and financial benefits no longer guarantee the genuine loyalty retailers and suppliers need to survive and thrive.

On the back of this we have also looked at more category-specific loyalty programs, asking how brands can put together schemes that build lifelong relationships with customers. We specifically asked the question: “What capabilities are needed to succeed?”.

In a world where loyalty is no longer driven by the simple ‘points per purchase to redeem later’ equation, what do brands need to consider when restructuring their schemes to fit the new consumer needs? To address this, we researched and analysed multiple loyalty schemes in beauty, both new and older, to decipher commonalities we then grouped into four key areas.

These four areas are the foundation of the key capabilities for success discussed in our Beauty + Loyalty - Key capabilities to boost your loyalty program’ deck, published today. They are not mutually exclusive, but rather aim to create a comprehensive and holistic program that captures shoppers in a brand’s ecosystem and that speaks to new lifestyle values of shoppers.

It’s these values we believe will move beauty brands from ‘habitual’ loyalty to ‘genuine’ loyalty. Below is a summary of the capabilities, to view the full-length version and access the accompanying case studies for each capability click here.

The key capabilities for a successful beauty loyalty program:

A loyalty program in 2019 and beyond must be: Connected
Connect your loyalty program across channels. This allows customers to utilise your loyalty program wherever, whenever.  

To adhere to shoppers need for validation and community it must also be: Social
Bring social media into the equation and creating a community-style atmosphere that encourages users to interact.

Brands should also limit the focus on points per sale and focus more on being: Action-Oriented
Expand points beyond purchases to make it more engaging and interactive.

Finally, data should be utilised to create loyalty programs that are: Personalised & Tiered
By including personalised messages and services and tiering it so there’s a reason to purchase more, the loyalty program becomes both customised and exclusive.

Working in Loyalty? Beyond this deck on Loyalty in Beauty we also recommend you take a look at our most recent Ingenious Innovations report, focused on the newest solutions in loyalty and how these can be leveraged to increase ‘genuine loyalty’ among your consumers.

Hanna Ryngmark

Hanna Ryngmark
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