Rewards marketing no longer works 'en-masse'
Conventional wisdom holds that marketing is evolving from traditional mass to a fully personal approach. As consumers today continue to expect more from brands in terms of engagement and rewards, untargeted marketing approaches have quickly become a thing of the past, according to Jeff Reiser, VP of financial services strategy for digital marketing firm Epsilon.
The reasons for moving beyond mass marketing are well understood -consumers have varying interests and their responses to messages and offers differ. Over time, this move beyond mass is taking on greater urgency because consumers today have heightened expectations. As such, it's difficult for consumers to be loyal to providers who do not "know" them.
It's easy to see why the move to fully personal marketing may seem ideal. One-to-one communication suggests a desirable connection to the consumer. However, technology-driven marketing can be difficult to execute and consumers' needs and preferences are subject to change.
So what lies between mass marketing and a personal connection? It's all about the broad and attractive space of relevance. Being relevant means that you understand the consumer and can anticipate their needs. When they receive an offer, you want the consumer to think, 'Yes, this makes sense for me'. When done artfully, a relevant offer builds engagement, so your goal is to optimize it for relevance.
While loyalty marketers have historically been among the very best data practitioners, they don't always personalise redemption options effectively. Many programmes show the same redemption catalogue to all members. There's a reason to show a vast array of potential redemption options; this emphasizes abundance, variety and choice. The belief has been that consumers will actively seek out what they want most. However, in many cases consumers face too much choice, creating confusion and irrelevance.
To be successful, rewards programmes must strive for relevance by highlighting redemption options that generally fit customers' interests. This requires gathering all available customer data, assessing to match segments based on category and redemption size and taking action on those insights accordingly.
By leveraging data analytics and intelligent platforms, rewards marketers can create rewards programmes that are more relevant, achieving the middle ground between mass and personal marketing and ultimately enhancing customer engagement.