The goal of this use case is to test the effectiveness of your rewards, such as vouchers to win back defecting members. Your general goal with Loyalty is to decrease the costs of your plan but increase member interaction and the number of purchases.
Vouchers can be used to motivate members to make purchases and non-members to join the Loyalty plan. One of the goals of the loyalty program is to reduce the amount of vouchers offered to members and replace it with points or experience (e.g. Exclusive access).
It is worth testing what is the most effective value for vouchers to drive your contacts as vouchers often represent a form of financial obligation (discount, free shipping).
Note that vouchers do not necessarily drive repeated purchases. Points, however, can be redeemed for vouchers. For example, members could earn points for a purchase, which in turn could be converted to vouchers slightly below the Average Order Value. This way, the members are motivated to make a second purchase for a greater value than the received voucher.
Prepare the following elements in advance, so you can quickly select these in your Automation Center program, which is the backbone of your campaign.
Split your contacts according to their Loyalty membership. Use the Filter switch action node. If not already prepared for you during the Loyalty onboarding, create a relational segment for this with the template Loyalty members - all.
Follow the steps in Creating Loyalty segments to create your segment.
Create your Purchase actions. Through these actions, your customers will only receive their rewards if they make a purchase.
You will need a purchase action for each type of reward offered (bonus points vs vouchers in this case). However, one purchase action can offer different rewards for each tier and non-members.
Automation Center program
The following Automation Center program example shows a scenario to win back defecting members. Additionally, you can use it as a test to see if your contacts prefer to earn Loyalty points or vouchers as rewards. This can serve as a basis for further tests to finetune your rewards for the maximum effectiveness.
1. Using your Target segment entry node with a Smart Insight segment , filter for your defecting members.
2. After grouping your contacts according their Loyalty membership status (relational segment), divide them further by using A/B Splitter action nodes. Set a ratio of 33%/33%/34% (or equal proportions depending on the number of reward types). One third of each group will receive vouchers, one third will receive point multipliers, and the last third will receive bonus points.
By previously dividing them into non-member and member groups, you will also see which reward types motivate more contacts to join your Loyalty program.
3. Add send email nodes to each of your test groups. Select the relevant campaigns for your target groups, which should contain the token for the purchase actions with discount voucher and bonus point rewards.
4. Add a wait period of a couple of days after sending each email. Use the Wait action node.
5. Further split your contacts by using again the Filter switch action node with the previously created Defecting Member Smart Insight segment filter. This way, you will see who made a purchase due to the received message and rewards.
6. Do not forget to finish each of your branches in your program with a finish node.
After launching the program, you can check the number of contacts passing through in each node by checking the Automation Center Program Reporting.
Based on this information, you can check which reward was the most cost-effective to motivate your contacts to purchase.
This pattern of Automation Center program (comparing rewards with increasing value) can be used for different scenarios to optimize your costs.