By Achille Traore, CEO of White Label Loyalty
Achille Traore is the CEO of White Label Loyalty, an enterprise platform that provides engagement and retention solutions for brands looking to build deep relationships with their customers. Using smart technology architecture, brands can reward any type of activity with points, rewards, cashback, discounts, and more.
How Brands Can Transform a Recession into Lifelong Customer Loyalty
It’s hard to imagine building customer relationships in a down economy. But it’s not only possible – it’s crucial. Consumer behavior is changing as costs rise, and brands must adapt.
Research shows that consumers react differently to brand messaging and promotions during a recession. Customers are putting you under the microscope. They expect more from the brands they choose. They want to feel appreciated, and trust that you are taking care of them.
Today’s economic downturn is an opportunity to build deeper relationships with customers. Showing your support and appreciation is key. The brands that do will build loyalty that can endure regardless of the economy’s recovery.
Rethink what “value” means to your customers
Brands from every industry are competing to win customers. But business costs are rising too, so offering the cheapest price isn’t always feasible.
There’s no need to limit value to cheap deals. There is more to value than just low prices – it’s also about getting a great experience for your money. Think about engaging user journeys, exciting rewards, and personalized marketing.
Keep in mind that customers will remember how you treated them during economic pressure. 77% of customers expect brands to show support to people in times of crisis. It could mean the difference between losing customers to competitors or gaining lasting loyalty.
So how can brands show customers appreciation and support during a financial crisis?
Data, rewards, and empathetic marketing.
It all starts with data
Data is the most important part of any strategy – and you’re going to need it now that consumer priorities are changing.
The right opportunities come from understanding your customers’ minds as well as monitoring and responding to their behavior changes.
But make sure you base decisions on genuine customer insights – not guesswork or gut instincts.
Insightful data helps you understand your customers on a granular level. Then, you can understand which rewards and marketing strategies will have the most impact…
The best kind of rewards to use at this time
Rewards are crucial in offering your customers a great experience. When you reward your customers for choosing you, you become the brand of choice.
It’s exactly why big players such as McDonald’s (UK), Sony, and PayPal have launched rewards in the last year.
But which reward mechanisms work best in a recession?
Frictionless points-based loyalty programs
Points programs help customers get more in return for their spending. To be effective, they should be effortless to use.
Global investment company Dubai Holding launched Tickit – a first-of-its-kind rewards app with an effortless way to earn and redeem points. With no need to scan loyalty cards or apps, Tickit automatically captures relevant transactions thanks to card-linking technology. Shoppers are rewarded for purchasing at virtually any destination across the Emirate, including major attractions such as world-class dining and hospitality spots, online and in-store shopping, transportation and so much more. Leading in the evolution of rewards programs, Tickit is the perfect example of offering customers more value.
Perks programs that ease cost pain
Perks programs are often used in industries where purchases feel like a necessary evil – like insurance, healthcare, and other mandatory expenses. Perks programs offer members-only rewards and increase a brand’s value proposition.
Wesleyan is a UK-based financial services company that offers a choice of rewards to its most valuable members every year they stay. This simple but effective reward system gives Wesleyan customers something back for necessary purchases – such as saving for retirement. As a result, Wesleyan have increased engagement, with a 68% redemption rate on their rewards.
A great way to ease consumer stress during tough times is to offer incentives that require little effort on the customer’s part. And when it comes to convenience, nothing beats putting money back into consumers’ wallets. With the right technology, cashback rewards are frictionless. Plus, cashback provides instant and tangible value to customers.
PayPal introduced a cashback scheme to give customers added value while they shop. Its ease of use sets it apart from other solutions. You can earn cashback just by using PayPal as your payment method. Customers will be attracted by this frictionless simplicity – because who wants to check for cashback-tracked links every time they buy online? For consumers, it’s an easy way to get some much-needed financial relief. For PayPal, it’s a powerful retention mechanism that encourages customers to keep using the service.
Now is the time for empathetic marketing
At this time, consumers want brands to show more care in their communication. Those that do will be able to build more meaningful relationships with their customers.
Don’t pressure customers to buy unnecessary products. Instead, consult your data to deliver personalized product recommendations that help consumers make informed decisions and feel supported.
For example, if a customer regularly buys a product, let them know when it’s on sale or low in stock. This approach will increase loyalty by making customers feel like your brand is looking out for them.
It’s a win-win situation; your brand gets more loyalty, and customers feel better about choosing you because they don’t feel exploited or forced to spend money on products they don’t usually buy.
When it comes to marketing campaigns, businesses should focus on positive outcomes instead of negative risks. For example, life insurance companies should emphasize the benefits of taking out a policy (like stability and peace of mind) rather than the negative consequences of not having one. Negatively framed messages are hard to digest during periods of financial insecurity.
A recession is a great opportunity for brands to build lasting customer relationships
Despite the current state of the economy, there is a silver lining to be found. By using data, rewards, and the right promotional messaging to build customer relationships, brands can create loyalty even in this tough economy.
Making decisions based on short-term gains may be tempting; lowering prices and pushing promotions are quick ways to drive sales. But as brands race to grab market share, they may miss out on building meaningful customer relationships.
Let’s move beyond the narrative that ‘value = cheap deals’. Brands can easily offer a highly valuable experience by delivering great rewards. Recognize your loyal customers by giving them something back – whether it’s discounts and perks, or instant cashback that helps them stretch their budgets.
And remember – consumers are wise, don’t try to fool them. Brands that exploit customers during a recession will lose them. Use empathetic messaging and don’t push unwanted promotions. Consumers have the power right now and will switch to brands that genuinely care about them.
After all, what’s the point of winning customers’ dollars if you lose their hearts?