a loyalty reboot that delivers dollars

Sephora might be considered the loyalty GOAT, but Ulta’s loyalty program is bigger and about to improve. The beauty retailer just announced a deal with Adobe to deliver personalized loyalty. They’re using Adobe’s Real Time Customer Data capabilities to deliver “seamless” loyalty content “everywhere.”

Seamless, personalized loyalty everywhere sounds great – want some?

Here’s what it takes: In addition to the resources to pay for a robust technology, you need data from 44 million loyalty members, a red-hot loyalty category, hundreds of thousands of SKUs, high-frequency shopping, and constantly changing affordable luxury products that lend themselves to customers vying for VIP status, previews, and free shipping. 

In other words, Ulta is perfectly positioned to crush loyalty. They have no choice – it is the core of their business. Programs tend to languish for brands and retailers that don’t live and die by loyalty. Typical issues are:

• a one-size-fits-loyalty program, programs that are run manually or through a platform that’s not designed to manage loyalty

• programs that don’t communicate with members, so they have no incentive to be active

• a lack of data and insights to personalize, create tiers or gamify the program.

To beat the loyalty slump, marketers need to assess its potential value. Can loyalty increase LTV by a specific percentage? How much does that translate to revenue this year? Loyalty could reduce costly customer turnover – what are the estimated savings? Once a marketer understands loyalty’s potential, there will be a reason to invest (or not) in a more robust program.

The next step is to get the data ducks in a row. Loyalty requires a decent data capture and retrieval process. Customers need to be readily identified, and shoppers must be matched to their data profiles. You want to know all your shoppers; you need to know your loyal shoppers. 

Then, find an affordable vendor to help bring a loyalty program to life. This process requires due diligence. The UI needs to be usable, seamlessly integrate with the martech stack, and work across channels (site, app, in-store) in real-time. It needs to work with your unique requirements.

It’s worth the work. Well-executed loyalty programs deliver incremental revenue. Here's what buyers have to say about their loyalty programs:

"I would like our loyalty program to be more specific for our customers. The pet that appears on the front of the card should be their, well, not necessarily their pet, but their pet type… The emails that go out, texts that are sent need to be personalized for them, but also our ability to use the platform that we use right now (Insight Out of Chaos) is very, very hindered. I can't look and see easily any of the information that I've sent you or anything that you have purchased within our store. Emails to build within that platform are extremely difficult. It's not a good WYSIWYG, and we are also limited by the HTML we can include. So the customer communication aspect of that loyalty program is what could be enhanced."

DIRECTOR, MARKETING
$100M-500M PET SUPPLIES COMPANY

"These are the top things I’m looking for in a loyalty program: being able to automate some rewards for people and being able to keep track of the analytics on if people are moving through the phases… We looked at LoyaltyLion and Yotpo in the past. I think LoyaltyLion did almost everything that we wanted to do, but both programs were having trouble showing what the ROI was going to be or anticipating ROI. To me, that's a big factor when investing in any type of program. I need to be able to show some sort of return on investment."

DIRECTOR, MARKETING
$10M-100M APPAREL RETAILER

"It's been a year-long project vetting out new loyalty programs. One of the biggest reasons that the team decided to move to Thanx was all the automations that it was capable of doing. We use Punchh right now, and it's very, very manual. We outsource a lot of the work now… We manually build out all our segments in Punchh. And with Thanx, they have about 75 pre-segmented segments that you can just click a button on, and they'll automate it for you and build it."

DIRECTOR, MARKETING
$10M-100M FAST CASUAL RESTAURANT

"One aspect to Merkle is loyalty. They handle anything point-based, which is a large backbone of our loyalty program. So they generate offers, and those that are kind of point-based. For example, we have different tier benefits based on what tier you are, Green, Navy, and Gold, and they power all those tier differences. So, for example, if you're a Navy shopper, you get 2X points on specific occasions. They handle seasonal promotions and one-off promotions. They handle a good bit of our promotions that I think of… I'd say they’re a 10, confidently a 10. They've always been very great in terms of solution management and intuition."

MANAGER, PRODUCT
$1B-10B APPAREL RETAILER