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Non-Transactional Engagements

Over the last year, loyalty members have changed – they have new habits, new expectations, and new needs. For brands, relearning who their member is, and how they want to engage with a program is critical.

Engaging members between transactions – whether it is to complete their profile, play a game, or support their community – enables brands to rediscover who their member is and what motivates them. Between-transactional engagement also provides brands with new, updated first-party data, and keeps a brand in the members’ consideration set even when they are not actively buying.

When activated, that first-party data can help drive more spending and engagement by delivering relevant, personalized messages and offers. Personalization is an important driver of loyalty and retailers are investing in personalization tools to drive the customer journey more heavily than any other industry. This is a wise investment as 70% of consumers say a company’s understanding of their personal needs influences their loyalty. However, only 15% of CMOs believe their company is on the right track to personalization. Leveraging non-transactional engagement is a way retailers, and any brand for that matter, can rebuild relationships with members, enable personalization, and drive increased loyalty. While all retailers can benefit from non-transactional strategies, verticals with longer purchase cycles or lower margins should give particular focus to non-transactional engagement strategies to stay top of mind between transactions.

Understand your customer beyond the point of sale

An easy starting point for brands looking to capture more first-party data to drive personalization is to award members points or offers for completing non-transactional tasks such as social media follows, product reviews, or profile completions. When awarding for non-transactional engagements, the key is to find the sweet spot of awarding, so members do not become trained to expect a reward for every action.

When awarding for non-transactional engagement, the key is to find the sweet spot of awarding

LOFT’s All Rewards Program and Sephora’s Beauty Insider program incent members on data points most valuable to each brand’s loyalty strategy. LOFT’s program prompts members with incomplete profiles to complete their profile for 100 points, which is 20% of the points needed to achieve a reward. It is compelling enough to capture the information, but not overly rich. Similarly, Sephora Beauty Insider has found the happy medium awarding on the most important member details that can be leveraged to personalize the member journey and capitalize through their order refill emails. Maintaining a holistic customer profile is valuable for retailers. Forrester recently reported that over half of brands that can effectively anticipate and react to customer needs have holistic profiles to target customer experiences.

Integrate experiences with members’ lifestyles 

As retailers build out more mature member profiles, curating content relevant to members is critical and a natural way to drive non-transactional engagement. Curated content can run the gamut in terms of both approach and efficacy.

Emerging Lifestyle Integration

CVS ExtraCare has created various sub-clubs, which help to drive member engagement within specific categories outside of a transaction. For example, the Beauty Club sub-club gifts members with on-trend samples, V.I.P. experiences, and a monthly trend report.

Leading Lifestyle Integration

Using a multi-app ecosystem that has a single back-end member authentication, Nike is leading the pack with innovation and customer engagement. Nike Run Club (NRC) is one of these apps that focuses almost exclusively on non-transaction engagement and building emotional bonds. Members can connect to Apple health to track fitness and activities, customize their training, receive coaching plans with audio-guided runs, earn trophies and badges to celebrate achievements and share runs with fellow runners while competing on leaderboards. Nike has created a centralized hub for brand enthusiasts, workout junkies, and sneakerheads alike to engage, interact and evolve.

Make fun & engaging experiences

Kobie research revealed 37% of consumers say they have joined a loyalty program for its surprise sales, games, or exciting shopping experiences, while 36% will join if the program provides statement credits, member prices, and cashback. Gamifying a loyalty program is a great way to drive engagement between the transactions. Brands leveraging gamification see a 47% rise in engagement, where oftentimes the game itself can be the reward. There are many ways to execute gamification strategies ranging from episodic campaigns to always-on programmatic features. Below are some samples of how different brands engage members with gamification.

Williams Sonoma

Sent members a series of quizzes over Holiday 2020 with topics ranging from finding your holiday style to sharing recipes for your perfect holiday drink.

Amazon

Prompts Prime members for predictions on sports games leading them to a personalized shopping experience called Fanshop.

Starbucks

Starbucks for Life in-app games offers loyalty members ranges of prizing for engaging in both purchase and non-purchase behavior.

Orange Theory Fitness

Using a heart rate monitor and scoreboard during classes, OTF also engages members between classes through personalized email communications summarizing a workout. OTF is clear about the goals and rewards for its members, the display of progress towards goals permeates all communications and their emails focus on the progress towards goals after every interaction.

Understanding customers across verticals

Retail loyalty programs are not the only programs that can benefit from non-transactional engagement. The FI industry can integrate into members’ lifestyles through educational content on financial health and literacy, drive between-transaction engagement, and increase emotional loyalty. SoFi is a brand that has done this well. They have a financial literacy quiz on their website and recently announced a 5-part educational course with Coursera around “The Fundamentals of Personal Finance”. QSR programs have used between-the-transaction engagement with loyalty members to drive mobile app downloads, create pick-up line efficiencies, and compensate for lost revenue from reduced advertising opportunities at live sporting events. Due to its mobile focus, gamification, and personalization efforts, Starbucks reported loyalty members were at an all-time high in Q2 2020 driven by average order size, frequency, and acquisition.

Conclusion

Developing a strategy to engage members between transactions will help brands increase consideration, control margin and better personalize the member experience. More importantly, a non-transactional engagement strategy will help brands relearn, rediscover and rebuild relationships with their most valuable members, after a transformational year.

If you’re interested in learning more about how to transform your engagement strategy, email us at info@kobie.com

https://www.forbes.com/sites/blakemorgan/2020/02/18/50-stats-showing-thepower-of-personalization/?sh=56c23d7d2a94 

https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/the-future-ofpersonalization-and-how-to-get-ready-for-it 

https://www.retaildive.com/news/forrester-few-brandscan-anticipate-and-act-on-consumer-needs/594849/ 

https://themanifest.com/digital-marketing/resources/how-use-gamification-improve-your-loyalty-program 

https://www.bloomberg.com/press-releases/2021-04-26/sofi-partners-with-coursera-to-launch-thefundamentals-of-personal-finance-specialization 

https://www.msn.com/en-us/money/companies/starbuckscorp-sbux-q2-2021-earnings-call-transcript/ar-BB1g7Pr0 

Kobie Marketing

Kobie Marketing