iclp report -5-best ways to increase holiday sales_singapore
TRANSCRIPT
BUILDING THE BUSINESS CASE FOR A LOYALTY PROGRAMME
AUGUST 2015
5 WAYS TO MAXIMISE SALES BY REWARDING ENGAGEMENT THIS CHRISTMAS
25 WAYS TO MAXIMISE SALES BY REWARDING ENGAGEMENT THIS CHRISTMAS
We all know that the holidays and peak shopping periods are some of the most opportune revenue generating times of the year. Shoppers are out in force to spend their hard earned cash on gifts for friends or loved ones. That exchange is often sweetened when they can earn rewards for buying those heartfelt gifts and be a reason for choosing to spend with one retailer over another.
Loyalty programme members are worth two to five times more than non-members; meaning that having a solid rewards programme in place in time for the peak sales period can give you that competitive advantage at the time when it will be of great benefit – both to your customers and your business.
Whether it is increasing footfall to capture a greater share of the shopping basket during peak times or targeting members with incentives and offers pre and post the holiday season, this is an optimal time to enhance your commercial performance and drive loyalty and devotion with your customers.
Double the value of your loyal customers this holiday period
35 WAYS TO MAXIMISE SALES BY REWARDING ENGAGEMENT THIS CHRISTMAS
Be different!A rewards programme and the associated loyalty initiatives can make you stand out over and above your competition – especially during peak shopping periods in a very busy marketplace. The sooner you have one, the better your opportunity is to maximise revenues when the shoppers come in this key sales period.
What is the business opportunity for a loyalty programme?
• Maximise sales during peak shopping periods – Singapore’s
GDP was worth USD$308bn in 20141, with the retail
industry accounting for about 7% of that, at approximately
USD$20bn2
• Get customers to buy from you - with a huge 92% of
consumers3 belonging to at least one retail programme
and 84% more likely to visit the website of a retailer
with a loyalty programme
• Encourage switching behaviour - 91% of shoppers4 would
switch brands to one offering a promotion or reward
• Differentiate your brand - 70% of retailers3 surveyed
had no loyalty programme in 2013 and only 34% were
planning on running one.
Turn customers into engaged and loyal members
• Leverage an increased footfall by targeting programme
members with exclusive offers and positive experience
enhancements that further drive sales and increase
customer spend; bonus time gift periods, member
shopping evenings and double point days
• Look at sweetening the rewards during the festive
period to further entice loyal shoppers. Companies like
Fraser Shopping Malls allow shoppers to earn double
points during the festive season5
• 35% of shoppers6 who made use of loyalty programmes
will optimize their point earning opportunity, waiting
for double- or triple-point days to purchase gifts
• One in five shoppers reported adjusting gift ideas based
on which products offered significant discounts or
bonus rewards.
Sweeten the rewards during the festive period to further entice loyal shoppers.
1
Shoppers would switch brands for a promotion or reward
91%
OFFER
Shoppers wait for extra point days before purchasing
35%
45 WAYS TO MAXIMISE SALES BY REWARDING ENGAGEMENT THIS CHRISTMAS
Drive customer acquisitionThe opportunity to influence customer behaviour during the Christmas season and leverage peak shopping periods is huge in terms of acquiring new programme members and ultimately new loyal customers. Balance the incentive for sign up with the value you provide, so they don’t leave the programme or become a one-time purchaser. Giving them reasons to stay engaged – and buy from you again - is key.
Turn Christmas shoppers into repeat purchasers and loyal customers
• Acquire new customers - retailers can boost customer
acquisition up to 10% and market share up to 20%3 by
implementing a programme that rewards customers
for their purchases
• Understand your loyal customers - every guest
checkout during this peak time is a lost opportunity
to learn more about your customers. Leverage the
opportunity of increased traffic during high sales periods
with a simple and incentivised sign up process
• Reward customer engagement - use your loyalty
programme to reward customers who make a sale or
register an account. Giving bonus points will encourage
registrations and won’t reduce revenues like discounts can
• Secure more sales - half of Christmas shoppers use their
mobile devices to research gifts before purchasing
them in-store and six in 10 Christmas shoppers do some
showrooming7. Where prices are similar, the added value
of a reward programme could make you the retailer of
choice to capture that sale.
Retailers can boost customer acquisition up to 10% and market share up to 20% by implementing a programme.
Use your loyalty programme to reward customers who make a sale or register an account.
Motivate customer engagement
• There is a huge opportunity to influence customer
behaviour during the Christmas season, by engaging
with them in the run up to the peak shopping period. Use
targeted communication to learn more about what drives
their interaction and use this insight to further increase
engagement before the peak shopping period starts
• Continuing to track and analyse customer engagement
and purchase behaviour through their programme
membership provides additional insight and direction
on how to continue to maintain a relationship and
successfully market to them beyond the Christmas season.
2
Half of holiday shoppers use their mobile devices to research gifts before
purchasing them
1/2
55 WAYS TO MAXIMISE SALES BY REWARDING ENGAGEMENT THIS CHRISTMAS
Know your customerUse peak shopping periods to boost the intelligence you hold on your customers; build a story of them through their brand journey and optimise it to turn each individual customer from a number to a name. Turn any data you have into insight and identify the behaviours you want to motivate that will drive engagement and loyalty.
Gain more customer understanding through your programme
• Access personal information - shoppers who sign up
to a programme are more likely to give more personal
information;6 show a willingness to repeat purchase,
build trust and help establish a shared affinity and
longer term 2-way relationship
• Use rewards to understand more - research has shown
that consumers will share personal information in exchange
for tangible rewards8 whether that is loyalty points or
exclusive member discounts or bonuses
• Build comprehensive customer profiles - using an
interactive data capture strategy; starting with simple
email address sign up online or at point of sale matched
to a ‘take one’ card number, will allow customers to collect
and redeem points immediately further incentivising them
to complete their full profile to redeem
• Analyse behaviours and commercial performance -
research your customers’ loyalty drivers and their buying
behaviours and build your programme design and metrics
around these.
Consumers will share personal information in exchange for tangible rewards.
Using insight to motivate sales
• Understand who your customer segments are, not just
the top 20%. The behaviours and personality of the other
80% can give you vast amounts of attitudinal data and
behavioural analytics - use this to define strategies to
maximise engagement and sales with all segments
• Treat customers as individuals - savvy shoppers are
used to receiving a higher level of personalization; both
in your communications and programme offering. Your
programme will enable you to have the ability to serve the
right incentives, rewards and content at the right time in
the right place to the right shopper to increase sales.
3
Your programme will enable you to serve the right incentives, rewards and content at the right time to the right shopper
OFFER
65 WAYS TO MAXIMISE SALES BY REWARDING ENGAGEMENT THIS CHRISTMAS
Get the timing right…Whilst the key shopping times are obvious, the opportunity for strengthening customer relationships starts well in advance of those peak times. Implementing a loyalty platform doesn’t always need such planning or be as expensive or complex as you think and yet will provide a significant opportunity for building your customer base and increasing sales over this coming Christmas and peak shopping periods. Start investigating the possibility today.
Leverage busy shopping periods• Influence shopper behaviour - leverage the build up period
to motivate shopper behaviour, ideally using points to
create that ‘habit’ or learned behaviour of incentivisation
and gaining points way ahead of time
• Although with their favourite retailers, shoppers aren’t shy
of investing in gifts earlier in the year to benefit from the
best offers and rewards
• Maximise seasonal sales periods – loyalty programme data
means that you have specific insight into understanding
when your loyal members are likely to start their shopping
for key seasons, whether in store or online, meaning you
can put your messaging front of their mind in the run up to
the peak shopping periods
– Whilst 41% of consumers1 are keen early birds and start
their shopping before November, there are 39% who
shop in November, making it a peak shopping period.
However, 19.7% of consumers still do their shopping
right up until the end of December so there remains an
opportunity for retailers throughout the whole of Q4
– To kick start the peak shopping period, Robinsons hold
an annual gala night at the beginning of November,
exclusively for their OCBC Robinsons card members.
This gives them an evening of entertainment and parades
alongside their Christmas shopping, as well as product
demonstrations, makeup workshops and an exclusive
fashion show.9
Using points to create that ‘habit’ or learned behaviour of incentivisation.
Dates not to miss• The obvious peak days in and around Christmas
need no introduction, but the need to leverage and
achieve stand out is key, both in store and online, at these
somewhat frenzied shopping times!
– With differing levels of peak sales during Cyber Monday
and Black Friday, most Asian countries are expected
to see holiday shopping sales spikes in mid to late
December10
– In 2014, shoppers in Singapore spent more time shopping
during Chinese New Year and Christmas, than other
popular shopping periods. Footfall increased during New
Year weekend, and throughout, Saturday’s remained the
busiest shopping day, followed by Thursdays.11
To leverage and achieve stand out is key, both in store and online, at these somewhat frenzied shopping times!
4
41% of consumers are keen early birds and start their shopping before November
41%
The average order value of online sales on Black Friday increased YoY by 6.2% from 2013
6.2%
BLACK
FRIDAY
75 WAYS TO MAXIMISE SALES BY REWARDING ENGAGEMENT THIS CHRISTMAS
Beyond Christmas…Ramping up activity to make the most of the holiday period is important – but don’t let the planning, initiatives and success be JUST about the holidays. Drive initiatives forward into Q1 and beyond by ensuring you build a strong foundation for your customer relationships and an ongoing brand dialogue.
Put the foundations in place
• Drive ongoing customer commitment - any busy peak
shopping period can be a huge opportunity for retailers, not
just during the end of year holidays. Laying the foundations
to ensure your programme and loyalty initiatives are
successful during the holiday season can be challenging,
but getting this right can then mean reaping the benefits by
rolling out during other peak shopping periods
– In the US, retail spending is still a huge opportunity
during other softer holiday periods
• Encourage continuous customer activity – supplement
the rewards that your members have built up during the
holiday period with additional points offers with a limited
redemption date to encourage activity during slower
periods such as in January. Or allow members to purchase
overstock with their points, allowing you to clear items
that would act as a liability especially after the peak
shopping periods
Actively encouraging members to redeem as early as possible in the membership.
• Targeted tailored communications - use the data you
have about your customers and programme members
beyond the holiday season and ensure communications are
targeted and personalised, with content relevant to their
demographic and purchase behaviour. Regular newsletters
to your members with the status of their points earning or
tier and personalised offers work very effectively to engage
members and drive incremental spending
• Encourage redemption behaviour – by actively
encouraging members to redeem as early as possible in the
membership, our experience shows that this accelerates
further engagement and earning activity versus a member
who has not redeemed. What’s more, redemption
behaviour often results in additional spending beyond the
points that are available to redeem
– 18 to 24 year olds planning to use points or loyalty
rewards on gifts rose by more 40% last year12
– More than 60% of 35 to 44-year-olds plan to cash in
rewards points for gifts so many will continue to spend and
save their points and redeem them in the future
• Develop an end to end customer experience - it’s key to
maintain your customer relationships as soon as they walk
out of the store or click away from your website, regardless
of whether it is a busy shopping period or not. A continual
engagement programme will ensure your brand remains
top of mind as well as keeping the dialogue going.
A continual engagement programme will ensure your brand remains top of mind.
5
More than 60% of 35 to 44-year-olds plan to cash in rewards points for gifts
60%
Valentine’s Day – $17.3 billion Easter – $15.9 billion
Mother’s Day – $19.9 billion3
85 WAYS TO MAXIMISE SALES BY REWARDING ENGAGEMENT THIS CHRISTMAS
Plan and prepare well ahead of peak season to get the foundations in place
Leverage the footfall for key sales periods
Engage customers, before and during Christmas
Establish iterative data capture techniques – start simple and build your knowledge and their profile
Continue to engage the customer across their end-to end journey with your brand
Key takeaways
95 WAYS TO MAXIMISE SALES BY REWARDING ENGAGEMENT THIS CHRISTMAS
1. Today online: 11.2% rise in MasterCard spending during Great Singapore Sale, 2015
2. Channel NewsAsia: Retailers keeping expectations in check for Great Singapore Sale, 2015
3. Loyalty360: Five holiday retail customer loyalty lessons learned from back-to-school, November 2014
4. Singapore Business Review: 9 in 10 Singaporeans admit to biting loyalty schemes of retailers, 2013
5. Frasers Centrepoint Malls, 2014
6. eMarketer: How loyal are holiday gift givers? December 2014
7. Sweet Tooth: What your loyalty program needs to do this holiday season, October 2014
8. Epsilon: Is your loyalty program naughty or nice this holiday season? December 2014
9. Robinsons: Christam at Robinsons, 2014
10. Holiday Shopping Prediction Adobe Digital Index, 2014
11. adnear, Valentine’s weekend saw 18% heavy footfall on an average in top shopping destinations across South East Asia, 2015
12. IBM: Digital analytics benchmark hub – holiday benchmark data, January 2015
References
About ICLP
We drive customer devotion. We give your customers compelling reasons to engage, spend more and become loyal advocates - whilst delivering commercial results for your business.
As a worldwide leader in loyalty marketing and CRM, ICLP builds loyalty and creates devotion. From acquiring customers and understanding them as individuals, to creating relationships that engage, reward and inspire loyalty, we turn customers into advocates and relationships into profit
– and have done for over 25 years.
We have global experience in B2B and B2C loyalty marketing in multiple industry sectors including retail, travel, financial services and technology. Our expertise is underpinned by the skills and talents of over 600 talented colleagues who work across our 16 offices for clients in over 170 countries. With customer data at its heart, together we uncover insights, determine and deliver tailored experiences that create loyal customers and improve commercial performance.
ICLP is a Collinson Group company. Collinson Group is a global leader in influencing customer behaviour to drive revenue and add value for our clients.
With a unique blend of industry and sector specialists, the group develops and delivers market-leading products and services to help build, manage and optimise customer relationships across four core capabilities: Loyalty, Lifestyle Benefits, Insurance and Assistance.
© ICLP Worldwide 2015
A COLLINSON GROUP COMPANY
For more information on how we can help you, please contact Angela Tan on [email protected] or +65 6416 6319.
iclployalty.com