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As brands seek to create more ways for customers and loyalty program members to connect with them and deepen the relationship, leveraging the power a mobile experience can bring is a clear path for most. Yet, the road to increased digital engagement is not without possible potholes, roadblocks, and wrong turns. Without fully understanding the customer loyalty goals a mobile app supports or defining the purpose this type of digital engagement is designed to meet, the process could stall. Worse, it could launch and deliver a sub-par experience for users, alienating customers and members through a confusing interface, magnified friction during “earn and burn” activities, and less personalized interactions.
Loyalty360 spoke with supplier members and loyalty strategy experts about how loyalty program members can be enticed to embrace a mobile experience, leveraging gamification as an engagement strategy that builds excitement, and potential pitfalls a brand might face when developing a mobile arm of its customer loyalty program.
Article contributors:
Kristin Cardona, Sr. Director, Strategy, Ansira
Mladen Vladic, General Manager, FIS Loyalty Engagement Solutions
Chris Barnett, VP of Strategic Consulting, Kobie
Motivating Members To Embrace Mobile
As brands integrate mobile experiences into their loyalty programs to cultivate enhanced customer engagement and reduce attrition, it can be challenging to motivate existing program members to embrace and participate in the mobile arm of these programs. However, there are steps brands can take to encourage more mobile adoption within customer loyalty member bases.
Integrating mobile experiences into the overall loyalty experience should be an ongoing initiative for brands of all sizes, but the key is to do so incrementally. There’s an opportunity for all brands to better integrate disjointed experiences into a frictionless, intuitive customer lifecycle that meets today’s demands. FIS Loyalty Engagement Solutions’ Vladic asserts that the focus needs to be on making incremental enhancements over time instead of waiting to deliver one complete, comprehensive solution.
“Timing is the biggest challenge as the engagement model continues to rapidly iterate,” says Vladic. “The majority of members will embrace these experience enhancements without a need for an incentive, but financial institutions especially need to be prepared that there’s still a segment of cardholders that will require a series of marketing tactics to ease them into the mobile experience. The marketing push to mobile needs to focus on education with a digestible, easy-to-adopt checklist and offer lower-tier awards or a ‘surprise & delight’ to help this segment realize the power of the mobile experience.”
Kobie’s Barnett explains how engagement and retention can be boosted by blending digital perks and convenient functionality with real-world loyalty offerings, citing mobile-only deals, contextual or relevant content, and innovative features that make life easier or better.
“Keep folks hooked with timely nudges about their perks,” says Barnett. “It’s all about making your mobile experience so good, they can’t bear to miss out.”
Indeed, having a purpose and key functionality in the app can lead to better adoption and participation rates within a customer loyalty program. Ansira’s Cardona sees this as being accomplished by incentivizing guests to use the app with the program’s currency (e.g., points) and providing access to special content or offers, as well as exclusive functionality, to create an elevated experience for members. However, she notes that while more and more companies are shifting their loyalty program to “app only” programs, it’s important to be cautious of this approach to avoid the risk of losing customers who want to engage with the program in traditional avenues like the web.
Strategies for Optimizing the User Experience (UX) in the Mobile App
Simply developing and releasing a mobile app as part of a brand’s customer loyalty efforts is not enough. Brands must present an optimized user experience within their apps to better ensure ease of navigation through intuitive design and seamless functionality across different mobile devices and operating systems. This requires a clear understanding of what the mobile app is intended to do for the user — and the brand — and a commitment to delivering an experience that removes possible program pain points while exciting program members with a new opportunity to engage with the brand.
Cardona advises starting with a heuristic analysis to get a baseline of current usability and recommended updates needed to adhere to best practices. Brands must define their focus areas, such as actions they want members to take or friction areas they want to eliminate.
“Brands can employ some task-based user testing to get vital feedback from members on current state as well as future state,” says Cardona. “In general, it is important to prioritize user-friendly navigation with a simple and intuitive layout that includes easily identifiable sections and universal navigation elements to maintain consistent placement of menus, icons, and buttons across platforms.”
Card sorting is a technique Ansira uses to examine if the information architecture (navigation menu) is intuitive. This, coupled with robust search functionality and limiting the number of clicks to access key functions like point tracking, reward redemption, and program information, should create a better and more engaging UX.
“Make your app a joy to use with clean design, logical flows, and consistency across all devices,” advises Barnett.
Sometimes, the art is in what not to include to safeguard simplicity. Barnett encourages brands to use feedback loops to keep tweaking the design and functionality. He also recommends that brands consider adding AI for those “just-for-you” suggestions that hit the spot with those who appreciate options.
Gamification as a Tool
While the term gamification has become a bit of a buzz word, it continues to be a trend in loyalty programs with both traditional and non-traditional approaches. Traditional ideas — sweepstakes, contests, spin-to-win games, and scratch-off challenges — can provide an element of chance and surprise, which gives loyalty members fun ways to become more engaged. Cardona notes that challenges, badging, and quests are on the rise to increase engagement within loyalty programs. Furthermore, timebound challenges can encourage users to engage more frequently, themed quests add a variety of ways to keep the program fresh, and badging adds a collection element with a sense of accomplishment.
Cardona nods to Starbucks as consistently setting the bar as one of the best loyalty programs she’s observed. Part of that success can be attributed to the brand’s gamification during the summer and holiday season. Those games are designed to keep consumers engaged outside the path of purchase while providing the opportunity to earn badges, garner discounts, and even earn complimentary awards.
“We’d also be remiss if we didn’t mention how the games allow users to simply have some good old-fashioned fun,” adds Cardona.
For Barnett, the true potential of gamification lies in leveraging it not just for engagement but for enriching customer profiles with zero-party data.
“It’s less about badges and leaderboards and more about creating ongoing, immersive experiences that foster deeper connections and have a flywheel effect for the brand, amplifying the impacts of all future interactions,” says Barnett.
FIS Loyalty Engagement Solutions has been able to incentivize action-based engagement for a while — setting up direct deposit, referring a friend, or tagging on social media.
“Gamification allows you to lengthen the engagement moment during any interaction with your loyalty program. We’ve seen success with creating gamified experiences that reflect relevant events like the football season,” says Vladic. “Complete a task, close a ring, or earn a trophy for a first play or for downloading the mobile app.”
The visual validation of completing an engagement and triggering reminders in real-time in a way that fits seamlessly into the overall experience drives increased participation. It can also keep a brand top-of-mind for a longer period.
Leveraging Social Media, Amplifying Reach
Utilizing social media platforms can significantly enhance the reach and effectiveness of loyalty programs by fostering engagement and creating buzz. Brands leverage these platforms to generate excitement around their programs, update followers and prospects on benefits, and collaborate with influencers to drive participation.
“Hilton Hotels & Resorts exemplified this by creating lightning in a bottle with its #HiltonForTheStay campaign, a 10-minute TikTok video giveaway of 10M Hilton Honors Points in February 2023,” says Cardona.
The Hilton campaign successfully tapped into pop culture and utilized the platform’s features while partnering with popular creators to craft captivating content that resonated with viewers, leading to widespread virality. The campaign garnered incredible reach, amassing 4M views within its initial two days and averaging over 2.2M views per day over the course of two weeks.
Cardona contends this success highlights social media’s potential to amplify loyalty programs and enhance brand engagement through personalized communication and targeted marketing strategies tailored to specific audience segments.
Noting that several loyalty programs leverage social media for shout-outs, contests, influencer content, and sharing customer stories, Barnett acknowledges that Sephora is doing this well within its Beauty Insider community — particularly for VIB and Rouge members.
“It’s about creating buzz and a sense of belonging and status,” says Barnett.
Avoiding Potential Pitfalls
Even the most careful efforts around planning, developing/designing, launching, and managing a customer loyalty mobile experience can run into hurdles or larger challenges. Loyalty360 asked the experts what pitfalls and complications they’ve observed and how brands might avoid them.
While Barnett cites poor execution of personalization and a “clunky” UX as negatively impacting digital engagement, he includes questionable data security on the list of risks. Loyalty programs need to maintain trust in online data sharing, use data in smart ways that pay off that trust, and ensure frictionless digital journeys that avoid frustration.
“Always remember to keep evolving the digital experience to continually spark digital engagement during and between purchases,” adds Barnett.
For Vladic, not setting a clear, long-term engagement strategy objective prevents brands from being able to iterate the initial offering and deliver additional use cases over time with consistent messaging.
“To tell the story effectively, there must be a clear long-term objective that’s endorsed by all decision-makers leading the digital engagement strategy. This includes the need for consistency across departments and products,” says Vladic.
Lack of alignment across the organization leads to messaging changes that can confuse members, complicate the experience, and lower program adoption rates.
Cardona echoes Vladic. “In our experience with brands across many different industries with various levels of program maturity, the main and most common challenge we see stems from silos within the organization. For a loyalty effort to be successful, it needs to have buy-in from across the organization — beyond just marketing.”
Indeed, all impacted departments need to have some level of accountability — an added goal or a metric — that is aligned with the digital initiative being implemented. For some organizations, infusing loyalty accountability everywhere requires a new change management approach. Ansira believes there are four main areas in which to focus change management.
Identify a single individual to own the experience across channels, serve as the final decision maker, and champion the program across the organization.
Create a loyalty steering committee.
Determine key stakeholders across the leadership level who are knowledgeable and accountable to support and grow the program, ensure organizational alignment, and disseminate goals across teams.
Train and support frontline teams to ensure an understanding of program benefits, value, and mechanics and serve as customer loyalty advocates.
“By recognizing this challenge and implementing the proper change management, brands can enhance their loyalty programs, strengthen customer relationships, and ultimately achieve their business objectives,” finishes Cardona.
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