Loyalty 3.0: Planning Your Loyalty 3.0 Program

Are you a planner? Do you keep lists of things to do, a color-coded calendar, or sticky notes that help keep you on track?

You may say, “no, that’s definitely not me”. Or, you may say, “girl! That’s so me!”

I am definitely the ‘that’s so me girl”. I plan pretty much everything in my life. Obviously, you have to leave room for the Lord to direct your path, which I do, but I like to have all of my “to-do’s” in order.

Planning is something that is important in all aspects of life. Lumen Learning (n.d) defines planning as, “the process of setting goals and defining the actions required to achieve the goals”. Planning keeps you organized and on track, making sure that all tasks are completed on time. When it comes to Loyalty 3.0, organizations must plan out how they are going to plan their programs to be the most effective.

What is important to recognize before planning your Loyalty 3.0 program, is that any business can create this kind of loyalty program. You do not need to have big fancy technology, loads of money, or outside vendors to be successful with Loyalty 3.0 (Paharia, 2013).

To plan your loyalty program using Loyalty 3.0, there is a four-step road map that Paharia (2013) recommends. This road map includes: plan, design, build and optimize.

The planning step includes laying the groundwork for the loyalty program. This includes: identifying the problem, identifying your audience, identifying the desired audience behavior, establishing the key performance indicators, creating a mission statement, understanding the playing field, calculating the ROI, and selling it to internal stakeholders. These steps are what will make up the foundation for the loyalty program, and gives direction for the needs of the loyalty program.

Identifying a problem gives purpose to the loyalty program. This helps customers know why there is a need for Loyalty 3.0 to be established. Does the business need its employees to be more engaged? Are customers not sticking around or do they only seek deals without true loyalty to the brand? Identifying the problem your company faces helps to determine what the loyalty program needs to solve.

When talking about identifying your audience, businesses need to establish who they are targeting with their loyalty program. The target audience can be relatively broad or it can be a very specific niche of people (Paharia, 2013). It is often helpful to create customer personas to truly be able to walk in your ideal customer’s shoes.

After identifying your audience, you must identify how you want them to act and what behaviors you seek from them. For example, do you want them to visit your brick-and-mortar, order online, spend more money, leave a review, etc?

Establishing your Key Performance Indicators (KPIs) really just means “figuring out how to measure success”. KPIs can be the “number of registered users, average call time, number of page views, likes, and shares of content” (Paharia, 2013, p. 194).

Next, to drive your program, you must create a mission statement. A mission statement is the major goal that the company must obtain through the loyalty program.

Then, you must understand the playing field on which you are operating. Companies must understand the means they have to create a loyalty program, or the boundaries to their ideas, which may inhibit certain things in the program.

Lastly, companies must understand their Return on Investment (ROI). Is the loyalty program actually going to benefit the company’s revenue? If the loyalty program is not going to benefit the company in the long run, the investment in updating or creating it might not actually be worth it.

By doing these steps, Paharia believes that you will have a well-built plan for your Loyalty 3.0 program.

Lumen Learning (n.d.). Principles of Management. Lumen. Retrieved October 21, 2022, from https://courses.lumenlearning.com/wm-principlesofmanagement/chapter/reading-pros-and-cons-of-planning/

Paharia, R. (2013). Loyalty 3.0. McGraw-Hill