By Brandon Logsdon, PDI Software
Boosting c-store brand affinity through a loyalty program is more than just providing your customer with an "earn and burn" experience. If your goal is to retain customers while increasing your bottom line, the long play is necessary. In today's highly competitive marketplace, c-store operators are constantly battling to get bodies through their doors—and not just once. In a recent global study, 16 percent of U.S. based c-store retailers cited retention being their biggest challenge.
So, how do c-stores do this effectively? To truly optimize an excellent loyalty program, you must have a thorough understanding of your customer's journey from start to finish. Consider aspects such as: "What are the customers' first touchpoints?", “What next steps do I want them to take?", and "How am I incentivizing their actions over time?"
When business leaders consider how to create a repeat customer base through loyalty rewards, they must revisit a few things: 1) customer awareness, 2) the customer experience, and 3) how our digital world plays a part in customer retention.
Let's run with the marathon analogy.
Often in a marathon, the most challenging mile for a runner is usually between miles 18 through 23, far into the journey. On the road to customer loyalty, the most difficult step in the customer acquisition process is the first one - awareness; the first stage in the customer journey.
Low awareness often depletes the power of a loyalty reward program. Many times, the first line of defense starts with employees, which is a sore spot for many in the convenience store space. Front line associate turnover in the c-store arena can be as much as 100 percent on an annualized basis, making the pathway to a successful loyalty program difficult. Your front-line staff is imperative in spreading awareness by engaging and educating shoppers on the reward program in progress. One of the main ways loyalty program adoption takes shape is hand-to-hand combat in a store with a well-trained clerk talking about the benefits of the rewards program to the customer, versus customers coming into direct contact with signage and signing up.
The other side to this is the impulse angle within the c-store vertical. C-stores typically have two segments: the impulse shopper and the habitual customer. Habitual shoppers are mission driven. They stop at their c-store for a particular product consistently, as opposed to the impulsive shopper, who, for example, stops for gas and decides to purchase a soft drink on impulse, not mission. For c-stores, this is where a large amount of sales occurs, and it creates a challenge. How can convenience stores move customers from the gas pump and into their retail space consistently through loyalty instead of happenstance?
This leads us to the next leg of the race, the customer experience. What is most unique about convenience stores is their ability to sell the one commodity many retailers don't provide, and many people can't waste: Time. While providing valuable rewards is essential, convenience retailers must go beyond that to deliver a truly connected experience that keeps customers engaged but caters to their needs. To do this, they must research. Behind every successful loyalty program is the data to back it up. A successful loyalty program uses proprietary insights to change consumer behavior profitably. Remember that impulse shopper? With the right data, retailers can identify habits and turn them from infrequent visitors to habitual loyalists. Having the correct data also unlocks opportunity for c-stores to review shoppers' purchases, spending patterns, mobile app activities, location, shopping frequency, redemption activity, and email interactions to determine their next move better - and ten steps ahead.
With this, every part of your operational ecosystem matters, including how consumers pay and receive their goods. According to our recent global study on c-store shopping habits, 39 percent of consumers use a loyalty program's mobile app to pay for purchases. In fact, it's the third most popular behind redeeming and tracking rewards. These findings reveal that while the mobile payment is the present and future, savvy c-stores understand providing customers with a sleek mobile app alone cannot change customer behavior. Delivering personalized experiences and offers at the 'right time' across various channels is also necessary.
Our digital world is what helps c-store leaders constantly achieve success. The ability to repeat and refer depends on the experience you provide to customers and how you build your digital communications channels. Customer relationship management tools have historically been driven by email. In recent years, omni-channel communications (online, in-store, and mobile) took center stage, and most recently, push notifications. Push notifications have essentially created the perfect store-to-consumer interaction, making it the best way to reach a consumer. Whether chronic or by impulse, identifying the best medium to engage with your customer base is essential to a c-store loyalty rewards program.
The journey to customer loyalty is a continuous process. While difficult to execute, a successful program requires awareness, consistent research, a seamless customer experience, and the right communications channels. C-stores looking to gain a solid footing on meeting customers within their journey are consistent with measuring the impact and results of their efforts. This practice results in understanding what their customers want and when they want it, allowing c-stores to provide a personal and unique experience that drives loyalty and customer satisfaction for the long haul.
About The Author
Brandon Logsdon is president and general manager of Marketing Cloud and Fuel Pricing Solutions at PDI.