Dive Brief:

• Membership in loyalty programs has increased since last year at 64% of brands and the addition of mobile functionality is the biggest contributor to the increase, according to a survey by 3Cinteractive. The mobile marketing services firm queried around 500 brands' marketers and 2,300 consumers. 
• The survey found consumers want simplified mobile loyalty program sign-up processes (66%), are deterred from signing up by onerous information requirements (62%) and prefer loyalty program communications via SMS, although only 27% of marketers use it in this manner. The survey also discovered mobile-enabled loyalty programs influence purchase behavior (62%). 
• A dearth of technology know-how is preventing some brands from building their mobile loyalty programs, per 3Cinteractive. However, technological prowess is growing. Only 19% of brands reported they don’t have the necessary IT setup to support mobile loyalty programs versus 29% a year ago. 

Dive Insight:

The drive to digitize loyalty programs may have been spurred early on by interest in obtaining consumer insights and personalizing messages to regular customers, but it has gained new relevance during 2017’s retail industry meltdown. Effectively communicating with loyal customers and prodding them to visit stores is crucial to survive and perhaps thrive in a challenging retail atmosphere. If cultivated properly, these enthusiastic customers provide a steady stream of revenue. At Ulta Beauty, which has prospered amid the retail bloodbath, as much as 80% of sales are attributed to members of the retailers’ loyalty program Ultamate.  

Retailers understand the value of loyal customers and are ramping up their customer loyalty program spending as a result. The survey by 3Cinteractive shows brands have escalated their investment in mobile infrastructure to support loyalty programs, but it signals that retailers still have a way to go before delivering seamless loyalty experiences on mobile devices. Streamlining sign-in processes and sending messages to customers via SMS could help them engage and retain loyalty program members in mobile environments.

Adapting to mobile is a crucial step in pushing loyalty programs beyond the four walls of stores, but there are many further steps brands can take to amplify loyalty program outreach. In the write-up on its survey, 3Cinteractive mentions enhanced personalized content and offers, customer service chatbots and AI-powered voice assistants being the next frontiers for mobile loyalty efforts. Business 2 Community posits utilizing chatbots increases customer engagement and rewards can be doled out to encourage chatbot interaction.