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Back to the Future (of Loyalty)

Today’s that day. That day in time when hover cars were to ferry us from here to there effortlessly. Despite Elon Musk’s protestations to the contrary, we’re not quite there yet, though that day is clearly coming.



While it’s not as interesting as hover cars (but infinitely more practical), mobility has ushered in a “forward to the past” aesthetic for today’s brands-- particularly retailers.



It wasn’t that long ago that, right around the time “Back to the Future” premiered, people did most of their shopping locally. You were likely to walk into the grocery store, bakery, gas station or tavern and know the person delivering your service by name. And they would know you.



People were comfortable, felt appreciated and real loyalty (defined as patronage because you genuinely wanted to) was high.



Then things began to change. Local retailers gave way to big boxes. Efficiency became the mantra. Service became undifferentiated and undervalued by employers looking to decrease costs, inevitably leading to higher turnover.



Against this backdrop, some of the early loyalty programs took form. Almost an admission that service was not going back to prior levels, big companies enticed shoppers to stay with discounts, perks and points accrued over time.



It never really had much to do with “loyalty” by the common definition. It was closer to—what margin could retailers give back to keep frequency high? “Buy four and get the fifth FREE” sounded nicer than “20% Off,” but the math works just the same. This bottom-line mindset led to something of an arms race where consumers played retailers off of one another to see who’d give the most. Service was comparably average (at best), and the actual offerings were becoming similarly undifferentiated, so all that was really left was price.



All but the largest retailers suffered. So too did anyone who factored other considerations beside price into their purchases. Rightfully so, they felt undervalued.



Fast forward to today.



You don’t need a DeLorean. Just a modern strategy, synthesizing big data for the speed of mobile and an ability to act in real time during the moment of impact. With these technical requirements in hand, and a merchant’s skill for finding the perfect match for customers they know like the back of their hand, retailers and their customers are on a road to the past via the future.



Why would I, as a customer, use an app rather than the (mobile) web for online shopping? Because I want you to treat me as an individual. If I bought a pair of pants last week, show me shirts and sweaters that would go perfectly with them this week. This is the art of merchandising. It’s not taking orders, it’s walking the customer to what’s next. It’s leading. Synthesizing data allows an app to do what a skilled person did in years passed. Knowing what you bought, what you returned, any issues you had, what you may have abandoned in a cart…are all pertinent historical data that should be factored into the next engagement. The best merchants think of retail as an ongoing conversation. It extends well beyond the first sale and continues between POS transactions. It’s educating, informing and sometimes entertaining with content. If retailers are just waiting for the customer to show up, they’re doomed. Same goes for if they don’t react in the moment when customers do arrive, and act in a highly personalized way.



Those are all vital preludes to sales and the essence of real loyalty.



Welcome customer! Thanks for coming back if you’ve ever been here before!” just won’t cut it anymore, McFly.

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