A member lifecycle strategy (MLM) is critical to the success of a loyalty program, but it’s where we see most companies fail.
This article showcases the six stages of a basic (but best practice) member lifecycle strategy –with examples aimed at helping turn this struggle into success.
A best practice member lifecycle strategy focuses on maximizing the value a customer derives from the program, as well as the value that the brand derives from the customer. This involves designing specific tactics and initiatives for each stage of the lifecycle, with the goal of retaining and growing the customer base over time.
The acquisition stage refers to the process of attracting new customers to join the loyalty program. This is a crucial stage, as it sets the foundation for the customer’s future engagement with the brand. A strong acquisition strategy can help to attract high-quality customers who are more likely to become loyal and profitable in the long run. The goal of this stage is to make your program as appealing as possible, so that potential members are motivated to sign up. A join bonus can be a great tool to incentivise join and get members started on their pathway towards unlocking rewards.
Case study example: Starbucks
Starbucks is a well-known example of a company that uses a variety of tactics to attract new members, including in-store signage, email marketing, social media campaigns and partner campaigns. The Starbucks program is simple to join with multiple channel options available to members. The program also offers new members a free drink when they sign up, delivering an immediate reward and encouraging them to continue using the program.
The onboarding stage is all about introducing new members to the loyalty program and helping them understand how it works. This can include information on how to earn and redeem rewards, as well as any special offers or promotions that are available to new members. This is a crucial stage, as it sets the tone for their experience with the program and can influence new members decision to continue using it.
Case study example: Uber One
Uber One is a great example of a brand that has a strong onboarding process for its loyalty program. When a customer signs up for Uber One, they are greeted with an onscreen app message and a supportive welcome series through email, push and SMS which provides an overview of the benefits of the program, including free delivery on Uber Eats, at least 10% off Uber rides, premium service and other perks. Uber also provides personalised recommendations and offers to new members, helping them to discover new restaurants and other benefits they might be interested in to ensure they can get the most out of their membership from the outset of their engagement.
The growth stage refers to the process of encouraging members to engage more with the brand and its loyalty program. This can involve offering incentives and rewards for increased usage, as well as providing valuable content, experiences, recommendations and exclusivity, as well as gathering feedback to improve the program.
Case study example: My Dan Murphy’s
My Dan Murphy’s offers members personalised recommendations and offers based on their shopping habits. This helps to keep members engaged with the program and motivates them to continue shopping at Dan Murphy’s because they feel like the brand know them, understand them as an individual and offer them an extra level of convenience which saves them time.
The advocacy stage is all about turning loyal customers into brand advocates. This can be done by encouraging them to invite friends and family to the program, leave a positive review or share their experiences on social media.
Case study example: Sephora Beauty Insider
In addition to an always on ‘Member Get Member’ strategy, Sephora’s Beauty Insider loyalty program rewards members for leaving reviews on the website and for sharing their purchases on social media using the hashtag #BeautyInsider. This encourages customers to become public brand advocates and helps to promptly spread program positivity.
The retention stage is all about keeping customers engaged with the loyalty program and preventing them from churning. This can be done through a variety of means, including value reminders, recognition, personalised offers or excellent pervice service.
Case study example: Delta SkyMiles
Delta’s SkyMiles loyalty program offers a range of tier benefits to members, including free checked bags, priority boarding, and access to exclusive airport lounges. These perks help to keep members engaged with the program and motivated to continue flying with Delta in order to reach higher tiers and/or avoid losing access to current tier benefits.
The winback stage refers to the process of re-engaging customers who have become inactive or lapsed in their use of the loyalty program. This can be done through a variety of means, including offering special promotions, extra reward incentives, gathering feedback to understand why they left, and providing excellent customer service to address any issues they may have had.
Case study example: Audible
Audible send a series of personalised recommendations and targeted offer campaigns to former members based on their order history, offering a free or heavily discounted subscription period to entice them to return.
In addition to these promotions, audible also has a customer service team in place to address any issues or concerns that inactive members may have. This helps to build or regain trust in the service.
Overall, a member lifecycle strategy is an essential element of a loyalty program. By understanding and engaging with customers at different stages of their journey, businesses can create a personalised experience that will retain the best and grow the rest of the customer base