Don’t Go Breaking My Program

How to minimize member angst when making loyalty program changes

As the loyalty landscape continues to mature, many brands have started assessing their program structure and making changes accordingly. While change is not uncommon, your active members are likely to be the most sensitive and vocal. Before making any major decisions, be sure to take a good hard look at your program from your customers’ point of view to understand their behavior—what elements they’ve grown to love and what they might be able to live without.

Now, keep in mind that true loyalty is the outcome of a two-way relationship, and like any relationship, communication is key. During your communication planning process, be sure to account for the four straightforward but fundamental strategies below for a successful program transition to ensure that your beloved brand doesn’t over-rock the “customer” boat:

1. Inform: Let your members know when, why and how the program is changing.

Teaser communications can start to plant the seed that changes are coming, but don’t overuse them. Transparency and simplicity are two aspects that members want out of loyalty programs. Communicating changes clearly and consistently throughout the transition can help mitigate negative consumer perception. Consider how you can leverage current communication channels to reach your members with the right information at the right time. And before you inform your members, set your new loyalty program up for success by taking adequate time to train your employees. It’s especially important for frontline employees such as sales associates and call center representatives to be armed with FAQs and rationale, so they can reinforce your marketing messaging and be prepared to answer questions.

2. Educate: Teach members how to take advantage of all that the new program has to offer.

Early engagement is key to helping members feel at ease and excited about the new program. Develop an early launch education series to demonstrate to your members that your new (and hopefully, enhanced) program has their best interests in mind. And although a special, limited-time offer might be your hero message, be consistent with your core value proposition to educate members about the benefits, earn structure, rewards and extras. Don’t assume your members caught everything the first time.

3. Reassure: Reach out to your top members to make sure they feel acknowledged and appreciated.

How well do you know your customers? By identifying and proactively reaching out to your high-value members separately, you can make them feel appreciated before, during and after the transition. High-value members can mean different things depending on how you look at them (e.g., spend, frequency, influencers on social media, provide positive product or service reviews, etc.). Acknowledge your VIPs and reassure them with the specific benefits, rewards or experiences to get them engaging with the new program. High-value members rely on your brand to buy their favorite products or services. Show them you care and that they aren’t just another number.

4. Reward: Maintain brand love from your members with additional perks and experiences. 

The changes to your loyalty program shouldn’t just be a restructure for the sake of your P&L statement, but should also solve for customer pain points. More brands are turning to experiences and seeking out partnerships to expand the type of rewards available to their members. Offering a variety of ways to earn rewards (or points) will keep your members engaged. People can buy only so much, so consider rewarding them in alternative ways that may surprise and delight them. A study by Colloquy found that 50% of loyalty program members participate more actively in programs that offer a variety of ways to earn (e.g., share on social media, refer a friend, bonuses for birthday/anniversary, etc.).

So, before you press the restart button, be sure to put a plan in place to inform, educate, reassure and reward your members and employees. According to Forrester, it costs five times more to acquire new customers than to retain existing customer relationships. This makes losing loyal members due to a program change an extremely costly—yet avoidable—outcome. And when you truly deliver on your brand’s promises and values, especially during times of change, you can build trust instead of breaking it.