The philosophy behind all successful loyalty schemes dictates that you use the scheme to collect data to learn about customers in order to target them more accurately with relevant propositions and communicate with them more effectively so as to motivate them and influence their buying behaviours.
The resulting ‘customer insight’ generated from the analysis makes a significant contribution to the overall business case providing for significant commercial gain.
LCUK recommends that most organisations with ambitions for customer loyalty should consider the following recommended approach to embed data analysis into the operation of a loyalty scheme:
- Gain access to customer data and analytical environment to support customer analysis, planning and reporting
- Deliver a set of ‘data views’ that inform the business in respect of generic and targeted promotional planning
- Develop business reports that provide clear understanding of progress, problems and success
- Generate ‘Actionable Customer Insight’ that informs and transforms the business
The development of a successful loyalty scheme should encompass a detailed discussion about how data is collected, organised, analysed and deployed around the organisation. Some of the key questions include:
- Who manages the customer?
- name and address handling
- recording of demographic data
- customer identification/matching across channels
- creation of any user defined business rules
- creation of static attributes, e.g. date of birth and variable attributes, e.g. age
- creation of targeting attributes
- How to manage historic and time series data
- What is the strategy for data archiving?
- What are the most appropriate data summaries & transformations?
- What are the most appropriate segmentations and how are these managed?
- What are the rules for promotion response handling and analysis?
LCUK has years of experience in working with data, data analysis service providers, data analysis solutions and with the application of customer insight. This critical function is in many cases poorly implemented, starving the loyalty engine of the intelligence required to make the scheme most effective. LCUK clients invest in data in order to deliver the overall loyalty effect – happier customers born out of careful listening (data analysis).