Selecting member benefits is essential to loyalty program development. Our Statistical Loyalty Program Optimization™ brings you:

  • An objective, data-based viewpoint and business case you can take to your CEO and CFO
  • A focus on operational efficiency and ROI
  • Recommendations for an optimal loyalty program and benefits mix for each key audience

Loyalty Program Design: Why the Right Benefits Matter

Whether you’re in the first stages of loyalty program development or are reviewing your program as part of long-term management, your goal appears simple: engage customers with great rewards and reap increased sales. But defining “great rewards” can be a challenge.

Simply doing what your competition is doing or going with what your gut says won’t necessarily work. And unless you have that retail rarity — a homogenous customer base — the same perks aren’t likely to motivate all of the different audiences you serve.

Why does it matter so much? Because benefits cost your organization money and other resources. If they’re not paying off, you’re hurting your overall bottom line. And if they aren’t truly engaging customers and causing them to change their shopping behavior with you, then why have them?

On the other hand, when benefits work, they can pull new members into your loyalty program and push them to actively participate. This leads to better engagement — even to the point of creating brand ambassadors — and helps build increased sales and traffic.

To help you determine that ideal, motivating mix of benefits, CCG developed Statistical Loyalty Program Optimization. It uses a series of models that work in concert to predict the reach and desirability of potential benefits structures and their impact on sales. Here’s an overview of what it is and how it works.

What is Statistical Loyalty Program Optimization?

Statistical Loyalty Program Optimization is a series of models that use multivariate analysis and Total Unduplicated Reach and Frequency (TURF) analysis.

With multivariate analysis, we can evaluate the reach and desirability of multiple program approaches simultaneously — such as different points structures versus different merchandise discounts or some combination thereof. This allows us to determine the statistically optimal program value proposition.

With TURF analysis, we can evaluate the potential reach of various benefits and determine any overlap between them. For instance, if one perk is particularly appealing to one core customer group, you may be able to drop from consideration another benefit aimed at that same group — unless it also engages another target audience. TURF analysis also lets us identify benefits that have little to no value in the eyes of your customers.

Using our TURF simulator, our clients can also interact with the model to see how different customer characteristics affect reach for a single program element or a collection of elements.

Optimization Simulator Sample

Loyalty Program Design: Benefits and Finances

We understand that every loyalty program benefit has a monetary impact on your organization. And the ultimate goal of creating an ideal benefits mix is to improve member engagement and thus revenue. Therefore, along with evaluating benefit reach and desirability, Statistical Loyalty Program Optimization also considers:

  • Predicted revenue impact and ROI
  • Operational efficiency
  • Support of brand drivers
  • Aspirational impact for lower tiers and non-members

Statistical Loyalty Program Optimization: Benefits Recommendations

When all the analysis is complete, Statistical Loyalty Program Optimization recommends an ideal benefits mix for each of your key audiences.

Bringing Confidence to Your Loyalty Program Design

With Statistical Loyalty Program Optimization, we can bring an objective, fact-based perspective to your benefits selection process. And we can give you confidence that you’re using perks your customers will want — and actively strive to achieve, bringing more revenue into your store.

To learn more about Statistical Loyalty Program Optimization and for a free consultation to see how it can help your organization, contact us today.

Related Skills and Services

  • Strategic Loyalty Program Development and Design
    At CCG, we have an unparalleled level of experience in developing retail loyalty programs for top retailers across North America. Each program we design is customized to best meet our clients’ objectives and maximize their return on investment. We aren’t locked into any particular approach. Rather, we are innovators in developing non-traditional, cost-effective solutions that deliver an outstanding ROI.
  • Loyalty Program Implementation and Management
    Implementation services include loyalty program management, reporting and analytics, creative development and deployment of customer communications. Most importantly, we provide senior strategic oversight to ensure that your program stays on track and remains relevant with your customers.
  • System Selection and Integration Assistance
    CCG has a deep knowledge of loyalty and CRM technology solutions. We are not a solutions seller. Instead, we provide you with an objective view of what will work to best support your loyalty strategy. Our point of differentiation is that we define the strategy first, then identify tools (including any currently in place) to support the strategy. We then serve as loyalty subject matter experts to support IT during implementation, offering assistance such as blueprinting, functional requirements and use case development.
  • Loyalty Program Communications Audit
    We provide an objective, third-party review of customer-facing communications. This allows us to evaluate continuity and effectiveness of messaging, design, channel mix and other elements impacting customer engagement with and awareness of your loyalty program.