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Corporate Social Responsibility Strategies Strengthen Customer Loyalty


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As businesses look for more ways to engage with their customers, Corporate Social Responsibility becomes more than just a way to give back, it becomes a way to connect. When customers feel a brand is on board with their belief system, they automatically feel a closer bond with that brand. However, what are the best ways for brands to embrace a CSR strategy, and how can they determine which causes will resonate most with their audience?

Loyalty360 spoke with supplier members for their insights and perspectives on ways brands should best incorporate Corporate Social Responsibility into their loyalty programs, as well as ways to overcome the challenges involved with keeping consumers engaged in the efforts.

CSR Efforts Should Align with Brand Message
Corporate Social Responsibility has been a growing trend with brands who want to connect with their customers on a more emotional level. But how should brands incorporate CSR into their loyalty and engagement strategies?

According to PDI Technologies, Corporate Social Responsibility is more than a trend. It’s a useful and meaningful framework to articulate a vision around core principles that represent a broader definition of corporate stewardship. As with any emerging standard, there are many strategic considerations including what goals really matter, how they can be objectively quantified, what might be unintended consequences, and more.

Says Linnea Geiss, Chief Operating Officer at PDI Technologies, “Despite the corporate challenges of implementation and execution, what seems clear is that a significant population of consumers value brands with at least a partial lens to ‘how they do business’ as much as ‘what business they do.’”

Attila Kecsmar, CEO and Co-Founder of Antavo, agrees, stating, “The first step towards building loyalty is to gain people’s trust. One way to do this is by showing that you handle their information in a responsible manner, and by showing that their accounts as well as data are safe in your hands. Since loyalty programs deal with a lot of personal data (especially if a brand uses gamified surveys to offer points for sharing information), the importance of this step cannot be understated.”

According to the second annual Business of Sustainability Index [published June 2002 by PDI Technologies], 66% of Americans and 80% of young Americans (ages 18-34) are willing to pay more for sustainable products versus less sustainable competitors.

The index also reported that specific to the convenience retail ecosystem, 64% of Americans would be willing to pay more for gas if the carbon emissions from their purchases were offset through sustainability efforts; for Americans ages 18-34 this number jumps to 75%.

In addition to demonstrating ethical data handling, Antavo stresses that companies should advocate for causes that are supported by their core audience, but also align with their brand message. For example, recycling and re-using products can be a fitting message for a clothing brand.

Businesses can incorporate their loyalty programs in these efforts by organizing members-only events for their most active members and using the opportunity to identify potential CSR causes that resonate with them.

“The technology platform behind the loyalty program should definitely be flexible enough to allow unique reward scenarios, such as donating points to charity, allowing staff members to reward customers on the spot who bring back products for recycling, and even having the necessary capabilities to track CSR related actions separately, so that business owners can review whether their CSR campaigns actually contribute to business goals.” states Kecsmar.

Donating Points is Flexible and Tangible
Some brands have incorporated charitable donations into their loyalty programs, where members can donate points to several nonprofits. Kecsmar states this is a good and flexible way to promote noble causes because customers can decide how many points they are willing to donate.

He adds, “Another way to approach this is to allow members to donate or transfer unused coupons to charity organizations. This often has more tangible effects.”

Eric Favaloro, Business Unit Director, NYC at Comarch says that while the number of members that want the opportunity to donate their points to organizations vs. those that actually do it is an interesting side-topic, the demand for charitable redemptions within loyalty programs continues to grow.

He adds, “When considering this option, brands should focus on nonprofits that are relevant to their particular line of business or that align with key messaging within their marketing. Aside from burning points directly for a charitable donation, loyalty programs can also offer incentives (extra points/perks) for members engaging with nonprofits through their own channels.”

Regardless of approach, the main goal is ultimately to increase member engagement while also harnessing the emotional connection to good causes.

Building an Emotional Connection through CSR
Incorporating CSR into a brand’s engagement strategy can boost customer loyalty and build an emotional connection that cannot be made through transactions and conventional rewards.

Geiss states that one of the biggest opportunities brands have is being sincere with their CSR efforts.
“Find something that truly resonates for your company and your brand,” she says. “You’ll achieve better success when you connect your CSR priorities to things that flow naturally from your organization’s core values.”

For example, PDI Technologies serves an industry that is a key player in the energy transition movement: the convenience and wholesale petroleum industry. The brand has an opportunity to help the industry innovate what ‘convenience’ means and what makes a great place to stop, even when drivers are stopping for electric vehicle charging, not just fueling with gas.

Kecsmar stresses the benefits of positive word-of-mouth, as customers tell their other socially-conscious friends and family members about the opportunity. And if the business organizes a mass charity campaign on a special occasion, even media outlets tune in and spread the word about it. As for loyalty program members who participate in it, they develop a stronger bond with the brand, as they share the same values.

Keeping Customers Engaged in CSR Efforts
Of course, there are many challenges involved when incorporating CSR into customer engagement. Brands do best to combat these challenges with strategic planning and timely reviews.

Kecsmar quotes customer indifference as one challenge, citing that not many customers are using the opportunity to donate, or bring back used products for recycling. “In this case,” he suggests, “a company may wish to consider launching limited-time charity campaigns once or twice a year where the community can push towards a larger goal by contributing, instead of making these a constant option.”

In addition, owners can review whether their CSR campaigns actually contribute to the business goals.
“Companies and brands have a challenge on their hands,” states Geiss. “How to authentically build a CSR vision that connects with consumers when there is so much noise swirling around them.”

To break through, she mentions the following considerations:

Be choosy: The CSR menu is long and large, and you can’t move the needle on all things at once. Pick a few high-impact areas to begin. Things like data gathering and reporting, employee and community engagement, integration with internal and external communications, and connection back to business KPIs are good initial considerations.

Be sincere: Find something that truly resonates for your company and your brand. You’ll achieve better success when you connect your CSR priorities to things that flow naturally from your organization’s core values. For example, we serve an industry that is a key player in the energy transition movement: the convenience and wholesale petroleum industry. We have an opportunity to help our industry innovate what “convenience” means, what makes a great place to stop – even as what drivers are stopping for starts to include electric vehicle charging, not just fueling with gas.

Be frictionless: If you want to engage consumers along your journey, you must make it easy for them. In-line payment, loyalty, and donation systems should be high on the list of ways to implement your vision.

Be visible: Once you have decided on a path, be outspoken in your ambitions, your targets, and your progress. Keep the messaging a key part of what you communicate to stakeholders and reiterate your commitment and progress regularly.

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