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  • Samantha Steadman

Winning Hearts: Innovative Tactics for Retaining Customer Loyalty

The importance of customer loyalty is forever at the forefront of the retail industry. With half of UK consumers saying they have cut non-essential spend in the first quarter of the year[1], attracting and retaining loyal customers is paramount in a sphere where businesses strive to distinguish themselves from the crowds and the methods for cultivating and maintaining this loyalty are as diverse as the businesses themselves.

Two distinct paths for retaining customer loyalty often emerge front and centre: the allure of loyalty schemes and rewards versus the steadfast commitment to consistent low pricing. Both strategies offer unique advantages and challenges and the superiority of each route is fairly evenly matched, on the whole, coming down to the nature of the business, their target audience and the competitive landscape surrounding.


On the one hand, loyalty schemes make the promise to incentivize repeat purchases and foster emotional connections and appreciation for repeat customers by rewarding and gifting loyalty. On the other hand, the simplicity and transparency of consistent low pricing appeal to consumers' desire for value and reliability. In this blog, we detail a few of the strategies employed by brands and businesses to keep their customers coming back for more.


Tesco Clubcard Challenges[2]


Tesco has unveiled a new “hyper-personalised” Clubcard promotion in partnership with AI technology business Eagle Eye for its 3 million loyalty scheme members. The ‘Clubcard Challenges’ campaign started on 20th May and will be running for six weeks.


The scheme will give the opportunity for customers to collect up to £50 in loyalty points by doing 10 out of a choice of 20 “challenges” personalised to each shopper. The challenges range from spending £20 in the Summer BBQ range over 6 weeks, to spending £10 on plant-based meals, with shoppers rewarded for completing them.


Tesco group membership and loyalty director Lizzie Reynolds said, “We are constantly looking for ways to make Clubcard work harder for our customers. With Clubcard Prices on around 8,000 products, it is saving customers up to £360 off the annual cost of their groceries. Personalisation is about using what we know about customers to make their experience better and our rewards more helpful, and we’re very excited to see how our customers respond to Clubcard Challenges.”


JD Sports Prepares To Hit One Million Loyalty Members[3]


JD Sports is set to hit one million members of it’s JD Status loyalty programme just 7 months after its launch. To celebrate the huge milestone, the sports retailer is preparing to reward its members and entice new subscribers with a series of incentives. 400 existing members (one individual per UK store and 20 online shoppers) will be treated with a surprise £50 of JD Cash in their loyalty wallet and the lucky 1,000,000th sign up will be awarded £1,000 in JD Cash.


JD omnichannel strategic projects director Conrad Edkins said, “Reaching one million customers with JD Status has been an unparalleled journey, symbolising our commitment to enhancing customer experiences and shaping the future of loyalty engagement in the retail industry. The rapid growth of JD Status to one million customers underscores that our loyal members are the cornerstone of this remarkable success story for JD”.


Primark Lower Prices on Kids Summer Essentials[4]


For the second year running, Primark is introducing lower prices across hundreds of essential kids’ items in time for Summer. Despite inflation slightly dropping, nearly a quarter (23%) of Brits are still struggling or just making ends meet while a further 43% are simply “managing” with their spending. The initiative aims to help families make their money go further as they plan their Summer wardrobes.


The retailer continually works hard to continue reducing or freezing prices on kids and baby items, knowing how important it is to families to keep their costs low.


Gavin Daniels, director of Kidswear at Primark, said: “We know that summer can be an expensive time for families and as the holidays get closer, parents want to make their money go further with low prices that don’t compromise on great quality. As shoppers start to prepare for summer, we want to play our part by offering new lower prices across many products in our kids range to support families. Our customers can always trust us to bring them great quality at affordable prices, and we’re proud to go even further by lowering our prices once again.”


B&M No Gimmicks Food Campaign[5]


Bargain retailer B&M has launched a new food campaign across its stores and website dubbed it’s “big food event”. Hitting back against loyalty schemes ran by many big UK supermarkets, the event features the taglines “no gimmicks” and “no loyalty cards” while highlighting that its offers “everyday low prices 365 days a year.” Alongside the campaign on food items, B&M has also rolled out other deals across their ranges including gardening, electricals, every day essentials and pets.


Asda Profits Boosted By Loyalty Scheme & Lowering Prices[6]


Grocery retailer Asda is an excellent example of how loyalty schemes and lower prices can work in conjunction to ongoing success. Underlying profits at Asda rose by a quarter last year due to increased food and clothing sales. Around half of all sales are linked to Asda Rewards with 6 million customers using the app and identified as a key revenue driver. Customers are also responding well to Asda’s ongoing investment in value amid the cost of living crisis, where in 2023 they slashed prices on over 800 popular every day products.


Asda co-owner Mohsin Issa commented, “We are committed to doing the right thing for customers, colleagues, and local communities – and are putting in place the strategic building blocks to set up Asda for long term success.”


Perhaps the key to ensuring customer loyalty lies in striking a delicate balance between these two approaches, leveraging the strengths of each to create a proposition for customers centring around value and the ongoing relationship between brand and customer. The true measure of success in the world of loyalty is not the specific tactics and schemes used to get there, but in the ability to consistency deliver exceptional value, exceed customer expectations and build meaningful, long lasting relationships. By making customer satisfaction a priority by understanding the needs of their customer base and employing strategies to suit this, businesses can build a path to creating enduring loyalty and sustained growth within the ever-competitive retail sector.


 

 

 

 

 

 

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