Effective strategy to communicate in a loyalty program Exploring Effective Channels of Communication in a Loyalty Program

In today’s competitive business landscape, companies strive to retain customers and build long-term relationships. One effective strategy to achieve this is by implementing a loyalty program. A well-designed loyalty program not only incentivizes repeat purchases but also provides a platform for effective communication. This article delves into the various channels of communication in a loyalty program and highlights their significance in fostering customer engagement and loyalty.

Customer loyalty is one of the most important factors in business today, especially because greater loyalty towards a brand equates to higher retention. In today’s intensely competitive world, companies can no longer depend upon the traditional ways of advertising and interaction to improve customer engagement. It has, therefore, become a huge challenge for business owners to recognize and engage customers in a personalized and relevant way.

To achieve the success they desire, companies should look for improved ways to meet the needs of customers. Implementing new technologies can help businesses to achieve this and improve customer engagement as a whole.

New technologies have given us the ability to adopt an entirely new pattern in improving customer loyalty. Though it can be an expensive investment, if used to its fullest capacity can never be an investment that you’ll regret. Technology is changing the very nature of the relationship between customers and businesses, transforming it from a one-way transaction structure to a more holistic and interactive way. It is not only changing the way businesses operate, but it is also providing an effective way to interact with customers.

Listed below are a few key technologies that will help you to connect with customers on a deeper level.

1. SMS

In this device-driven world where consumers are increasingly social and mobile, SMS is one of the most effective and relevant ways for businesses to communicate with customers. Companies can send messages to customers regarding any number of topics related to their enrollments and earnings that tend to drive engagements and improve customer loyalty. These topics include point-related information such as available point balance, points earned, points redeemed, etc. Through messaging services, organizations can also send offers and promotions regularly to entice customers that will build more brand affinity. Personalized text messages sent by organizations act as a more personal tool to retain customers and drive long-term loyalty.

2. Interactive Voice Response (IVR)

Interactive Voice Response is the most cost-effective way through which businesses can build and foster personal relationships with their most loyal customers. The IVR is an intelligent self-service system that offers round-the-clock assistance for various customer queries regarding available point balance, overall transactions, recent offers and deals, announcements, etc. This proposes an intuitive service experience that allows customers to self-serve and resolve their queries within the IVR. Calls are further transferred to live agents if the issues are unresolved by the IVR. This results in better customer experience, improved business outcomes, and minimum operational costs.

3. Mobile Apps

In this technologically-driven world, mobiles have increasingly become an integral part of consumer’s day-to-day life. To retain customers and to build a loyal customer base, businesses must focus on building a compelling mobile presence through apps. If used correctly, mobile apps are capable of interacting with customers straight away to generate brand loyalty and demonstrate that the business cares about them and their personal needs. Mobile apps store information regarding the customer’s profile, current point balance, total points earned, points redeemed, etc. In addition to all this, it places, rewards, coupons & offers in one place alongside that makes real-time purchasing available.

4. Internet of Things (IoT)

With the emergence of the internet to connect millions of objects together and the inexpensive addition of sensors and microchips to any physical product, a digitally connected physical world has now become a reality. The Internet of Things is expanding rapidly and has proven to make an intense impact on loyalty programs by creating more flexible options for payment, rewarding members for specific activities, and posing more opportunities for personalized communication. It allows you to understand your customers and track their daily activities and tendencies more consistently. With IoT, companies can make a strategic plan to improve customer loyalty and increase effectiveness and create exciting experiences for their customers.

5. Short Code Messaging Service

In this technology-driven world, businesses are constantly looking for smarter and innovative ways to build stronger relationships with their customers. One of those smart ways that have proven to reach out to customers and boost customer loyalty is the SMS short code service. A shortcode SMS consists of a short virtual number in simultaneity with a unique keyword that allows customers to contact businesses through a short code SMS. This service enables your business to develop an automated message flow based on specific/unique keywords. It allows customers to communicate with a company or brand for various queries such as points received, points redeemed, etc. Focusing on SMS short codes on providing customer value will improve brand loyalty and sales rapidly.

6. Missed Call Alerts

The missed call alerts are the shortest, easiest, and most convenient path for the customers to reach your business. It is the best way to give customer updates via a computerized system. Whenever a customer makes a call, it automatically gets disconnected after the first ring which is thereafter followed by either an SMS or a voice service to complete the interaction loop with the caller. This provides customers with an immediate action or response from the company. Different numbers are given to the customers to perceive information regarding point balance, point redemption, available point balance, etc. This automated process not only enhances the user experience but also reduces the need for human resources to engage customers further.

Strategies to communicate in a loyalty program

Effective communication is the backbone of a successful loyalty program. To engage customers, foster loyalty, and drive repeat business, loyalty program managers must employ various communication strategies. Here are some effective strategies to communicate in a loyalty program:

  1. Welcome Emails: When a customer joins a loyalty program, sending a personalized welcome email sets the tone for their membership. This email can include a warm greeting, program details, benefits, and instructions on how to get started. It’s an opportunity to make a positive first impression and establish a connection with the customer.
  2. Transactional Emails: Transactional emails are triggered by specific actions or events, such as points earned, rewards redeemed, or upcoming program milestones. These emails provide real-time updates to members, keeping them informed about their progress, reinforcing their engagement, and encouraging continued participation.
  3. Personalized Offers and Promotions: Tailoring offers and promotions based on customer preferences and purchase history is a powerful way to communicate in a loyalty program. By using customer data and segmentation techniques, loyalty program managers can send targeted offers that align with individual interests, maximizing their effectiveness.
  4. Mobile App Notifications: For loyalty programs with mobile apps, push notifications can be a valuable communication tool. Sending timely notifications about new rewards, exclusive offers, or program updates keeps members engaged and encourages them to interact with the app. Personalizing notifications based on location or past behavior further enhances their relevance.
  5. Social Media Engagement: Loyalty programs can leverage social media platforms to communicate with their members. By maintaining an active presence on platforms such as Facebook, Instagram, or Twitter, loyalty program managers can share program updates, promote exclusive offers, engage with members through contests or polls, and respond to customer queries and feedback.
  6. In-Store Signage and Point-of-Sale Communication: Physical signage and point-of-sale materials in brick-and-mortar locations can effectively communicate program details, benefits, and upcoming promotions to customers. Eye-catching displays, posters, and brochures can capture attention and inform customers about the loyalty program, encouraging them to join or participate.
  7. Personalized Direct Mail: While digital communication channels dominate today’s landscape, traditional direct mail can still have an impact in a loyalty program. Sending personalized mailings, such as birthday greetings, anniversary rewards, or exclusive offers, can make customers feel valued and recognized.
  8. Online Communities and Forums: Creating an online community or forum exclusive to loyalty program members can facilitate communication, engagement, and peer-to-peer interaction. These platforms provide an avenue for members to share experiences, offer suggestions, and provide feedback. Loyalty program managers can actively participate and address member queries or concerns, fostering a sense of community and loyalty.
  9. Surveys and Feedback Requests: Collecting feedback from members is crucial for understanding their needs and improving the loyalty program. Sending surveys or feedback requests via email, in-app notifications, or dedicated survey tools can provide valuable insights. By acting upon feedback and communicating the changes made based on member input, loyalty program managers demonstrate their commitment to continuous improvement.
  10. Customer Service Channels: Providing accessible customer service channels, such as phone, email, or live chat support, allows members to seek assistance or resolve issues related to the loyalty program. Prompt and helpful responses contribute to positive member experiences and build trust.

Challenges of Communication in a Loyalty Program:

Effective communication is crucial in any loyalty program, as it directly impacts customer engagement, satisfaction, and retention. However, there are several challenges that arise when managing communication in a loyalty program.

  • Segmented Target Audience: One of the primary challenges in loyalty program communication is catering to a diverse and segmented target audience. Loyalty programs often attract customers from different demographics, age groups, and purchasing patterns. Tailoring messages that resonate with each segment can be demanding and time-consuming. To address this challenge, loyalty program managers should invest in customer data analytics to gain insights into customer preferences and behaviors. This data-driven approach enables personalized communication strategies, ensuring relevant messages reach the right audience.
  • Information Overload: In the digital era, customers are inundated with information from various sources. Cutting through the noise and capturing customers’ attention in a loyalty program can be arduous. The sheer volume of messages, offers, and promotions can overwhelm customers, leading to communication fatigue and reduced engagement. To mitigate this challenge, loyalty program managers should adopt a targeted communication approach. By focusing on delivering concise, relevant, and timely messages, they can maximize the impact of their communication efforts and minimize information overload.
  • Channel Diversification: With the proliferation of communication channels, loyalty program managers face the challenge of selecting the right channels to reach their audience effectively. Traditional channels like email and direct mail still hold value, but emerging channels such as social media, mobile apps, and chatbots are gaining prominence. To overcome this challenge, loyalty program managers should conduct regular channel preference surveys among their customers. This data-driven approach helps identify the preferred channels of communication and allocate resources accordingly, ensuring messages reach customers through their preferred channels.
  • Maintaining Consistency: Maintaining consistent messaging across different touchpoints is crucial for building a strong brand identity and ensuring a seamless customer experience. However, loyalty program communication often involves multiple teams and departments, leading to potential inconsistencies in messaging and branding. To address this challenge, loyalty program managers should establish clear brand guidelines and provide training and support to all stakeholders involved in communication. Regular audits and feedback loops can help identify and rectify any

Consider implementing these bits of technology in your loyalty program, if you haven’t already, and be prepared to experience the level of increased customer engagement that will follow. Always remember that the best thing about customer loyalty is that there is no limit to it. It can increase and expand, and if you manage it effectively, it will continue to grow rapidly.

Would you like to implement a loyalty program for your business to boost customer loyalty? Get in touch with us at talktous@loylt.works for a demo.


Prashanth Maxim.

CEO & Founder Director of Loyltwo3ks Pvt Limited.

20+ years in implementing enterprise business solutions globally for different industry verticals, from business analysis to business improvement an experienced entrepreneur with a record of success, an eye for market needs, and an ability to bring teams together, from technical developers to sales.

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