Real-time technology could revolutionise loyalty schemes

Customer Loyalty has advanced a long way in the past few years, but there are even more significant changes on the horizon for loyalty programmes and their operators. The debates about the benefits of loyalty programmes are over - and now widely accepted - with nearly half of UK retailers running a programme, and the rest of Europe (and indeed the world) catching up quickly. The latest developments revolve around ways of differentiating loyalty programmes from their competitors, and making refinements that make them even more effective.

Simply swiping a plastic card at the point of sale and waiting for a quarterly statement to get a points balance have become a thing of the past. The more advanced loyalty schemes operate in real time with personalised responses and offers being presented at the point of purchase, with the aim of providing members with instant gratification - and of course greater engagement.

EPoS systems can communicate with central loyalty databases to instantly deliver relevant messages based on past and current purchasing behaviour, as well as providing an up-to-date points balance. Real time analysis of loyalty and purchase data is now also feasible, thanks to increasingly powerful software and ever-faster hardware. Real-time technology also enables quicker and easier redemptions for goods while the customer is still in the store. In the past, retailers had instead created barriers to minimise redemption rates. But while that helped reduce programme costs in the short term, it also diluted the consumer benefit of the programme, resulting in lower take-up rates and lower revenue increases.

But, according to Chris Jacobs of Business Assyst, the next generation of customer loyalty programme will see the tracking of customer location as well as purchases. This can be achieved through the adoption of RFID or NFC-based cards or even mobile GPRS tracking (a technology for which consumers currently have to opt-in via their mobile network). These technologies can potentially record when a customer enters or leaves a store, enabling 'dwell time' to be calculated and non-purchase visits to be logged. More impressively, the store manager can be alerted immediately when a top-tier, VIP customer enters the store... Imagine being personally welcomed by the store manager whenever you go to the supermarket.

This and hundreds of other recession-critical topics are addressed in detail in 'The Loyalty Guide III', The Wise Marketer's latest 923-page global guide to customer loyalty programmes, techniques, practices and theory. The report is available now, worldwide, for £1150 (approx. US$1995 or Euro 1495). See TheLoyaltyGuide.com for the free executive summary, downloadable chapter samples, table of contents, online searching, and online ordering.