by Mark Johnson | December 13, 2011
Marketers are at a very critical juncture. According to Loyalty 360, the Loyalty Marketer’s Association, customer loyalty, rather than acquisition, is critical to driving sustainable growth. Yet businesses report that retaining and engaging customers remain their greatest challenges.

To help marketers develop more effective loyalty strategies, Loyalty 360 suggests they take a deeper dive into the following customer loyalty trends.

1. Customer engagement is the journey, loyalty is the destination. Loyalty is a much bigger, broader, richer, and complex idea than it had been in the past. Loyalty is no longer just about points, discounts, miles, and rewards; it is about the way processes, technologies, ideas, and interactions engage individuals with the brand. The only way to achieve loyalty is through deeper engagement.

2. There will be a renewed (and well-needed) focus on customer retention and loyalty versus customer acquisition. Customer loyalty has been identified as the top non-financial business challenge facing companies in 2012, according to business consulting firm Protiviti. While daily-deal sites like Groupon and LivingSocial are generating lots of buzz, marketers are realizing that price-based technologies have taken the focus away from the real prize: customer loyalty.

3. Brands need to recognize customers at all touch points, especially the call center, to deliver a quality customer experience. A recent poll by Loyalty 360 found that 78 percent of respondents believe that a great customer experience makes them loyal. Creating that level of customer experience involves the delivery of quality customer service across all touch points, and marketers are realizing that this means integrating the call center into the overall customer experience.

4. Marketers will work to glean intelligence from social media feedback. The vast majority of real-time data created today is unstructured data. Study after study shows that marketers struggle with mining this data and analyzing it in order to derive valuable insights and actionable intelligence. In fact, a just-released report by EMC found that only 38 percent of business intelligence analysts and data scientists strongly agree that their companies use data to learn more about customers.

5. The loyalty program is seen as a critical element of “life cycle management.” Engagement with customers over an entire life cycle is the new model for success. The only way to earn loyalty is through deeper customer engagement, and data gathered from loyalty programs can be used effectively to drive a quality experience across all touch points and at all stages of the customer life cycle.

6. Marketers will look at a mix of location-based behavioral data and attitudinal and preference data. This trend will have an especially important impact on the daily-deal space. Brands will want to have this data in order to control their messages rather than offer huge discounts to anonymous individuals.

7. Mobile coupons will go mainstream. Juniper Research forecasts that the total redemption value of mobile coupons worldwide will be more than $43 billion by 2016, representing an eightfold increase from $5.4 billion this year. Cost-effective mobile coupon campaigns provide merchants with an easy way to build customer loyalty.

8. We will see a focus on social media ROI. While marketers believe that the use of social media is worthwhile, most don’t know how worthwhile it is. As marketers become more sophisticated and skilled at navigating social media, they will demand more out of tools that track and improve return on investment. In fact, the 2011 IBM Global CMO Study found that 63 percent of chief marketing officers believe ROI on marketing spend will be the most important measure of their success by 2015. However, only 44 percent feel fully prepared to be held accountable for marketing ROI.

9. Brands will increasingly use the rich information about buying patterns generated via loyalty programs to create more targeted marketing/messaging. The data amassed and gathered from loyalty programs will be used to help marketers with segmentation and messaging for acquisition and retention. The information on customer transactions, likes, dislikes, and preferences gives brands the deep level of customer intelligence needed to deliver the most relevant, highest-quality customer experience and drive long-term loyalty.

10. Social personalization will increase. Marketers will harness the power of recommendations and referrals to persuade customers and prospects to follow their friends' leads. They will become more proactive in encouraging reviews, implementing refer-a-friend programs, etc.

11. Mobile digital wallets will mark a big shift in retail payments. With the value of transactions made via mobile devices estimated to be $240 billion this year by Juniper Research and predicted to triple that size over the next five years, it’s not surprising that the battle over mobile wallets will continue to intensify. And with analysts at Forrester Research predicting that consumers might be able to leave their leather wallets at home and pay for most of their shopping via their handsets by 2016, retailers need to think about the impact of mobile wallets as they build out their loyalty programs.

12. Worthy causes will continue to influence consumer brand loyalty. A study from Cone Communications found that consumers are more likely to pick a brand based on the charities or causes it supports. A full 94 percent of responding consumers said they would abandon their typical brands for ones of approximate quality and price if the latter backed social issues.

Mark Johnson is president and CEO of Loyalty 360, an unbiased, market-driven, voice-of-the-customer-focused clearinghouse and think tank. Loyalty 360 is committed to bringing customer loyalty to the forefront as a critical marketing strategy. A trusted source for cutting-edge research, best practices, and networking opportunities, Loyalty 360 gives members the expert insights and guidance they need to better understand loyalty and develop programs that effectively engage their customers and employees and build stronger relationships with them. For more, visit