It’s no secret that customer loyalty isn’t what it used to be. It takes just one experience with a brand to make or break a customer’s opinion of a company forever. In fact, a recent survey by Access Development reported that 79% of customers would take their business to a competitor within a week of experiencing poor customer service. The estimated cost of losing a customer due to poor service is $1.6 trillion.
Customers are the most important asset a company has and earning their loyalty early on is crucial for not only creating customer lifetime value, but also running a successful business.
Now more than ever, retailers are using loyalty programs to connect with their customers. It is rare to purchase an item without being asked to enter an email or phone number in order to receive special offers. But one of the biggest reasons retailers are offering loyalty programs is simply because it works – consumers love exclusive discounts and exclusivity.
In order to understand more about the successes and failures retailers are experiencing with their discounts and loyalty programs, SheerID recently surveyed 76 companies nationwide. Here’s what we found:
One of the key findings is that brands are willing to take on margin erosion to create these exclusive loyalty programs. A whopping 75% reported suffering from margin loss. And even with negative effects on margins, 84% of the companies planned to offer promotions in 2017, with 64% already offering or planning to offer exclusive promotions to customers such as students, teachers, and military members.
Another notable takeaway from the survey showed that the companies who were offering exclusive discounts and loyalty programs were highly vulnerable to fraud. 63% of the business offer year round online, in stores, and on mobile devices but that a majority of these companies verify their customers through coupon codes, emails, or by manually checking ID’s, all of which leave room for customers to cheat the system. This is exactly why we at SheerID are working to perfect our hosted verification solutions to make it easier for these companies to protect their offers.
Want to learn more about what we discovered in this survey? Read the full results here.
Spotify, Amazon, and Tommy Hilfiger are just a few of the companies who use SheerID’s solutions in order to protect their exclusive offers and loyalty programs from margin erosion and discount fraud. If you are interested in hearing how eligibility verification can help your company create even more loyalty among your most valuable customers, contact SheerID today.
