In focus: Building loyalty by knowing your customer
13 September 2015
Many banks have been working hard at improving their customer experience to help build loyalty to their brand.
Loyalty programmes are one of the few areas where banks can truly differentiate, engage existing customers, attract new ones, reduce churn, increase retention and improve customer lifetime value and profitability. It can be a good strategy for growth.
The more a bank can personalise its loyalty programmes and give customers compelling real-time offers, the better chance they have at retaining that customer.
However, the most common loyalty programmes being offered tend to be tedious for the customer to manage, offer little or no capability for customer personalisation and don’t help the customer build a connection to the bank’s brand.
But, technological advancement is changing this. Banks can now offer customers a more personal targeted service by evaluating their recent purchase behaviour and showing ads which are only relevant to them via their mobile.
It also gives merchants a new channel to get their message in front of active buyers.
Research is showing card-linked marketing programmes result in a two-to-three-times increase in card revenue versus bank’s points programmes, and the number of purchases at card-linked marketing merchants increased by 5.57 times.
In 2014, more than 500,000 cardholders were invited by a European bank to participate in a card-linked marketing programme and 90 per cent of them made purchases within a five-month period. Total card revenue increased by more than 14 per cent.
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