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Case Studies

Improve the performance of my loyalty program

European Retailer Gets A Loyalty Lift

A European retailer wasn’t sure if its loyalty program was as effective as it could be. As it was, the program allowed customers to earn points to convert into gifts or vouchers to spend in the store. Additionally, customers could earn points from a variety of partners connected to the program. The retailer wanted to know what program changes would really delight and excite customers, to build more loyalty and deliver measurable results — so it came to dunnhumby.

The insight

Upon review, some useful customer insight was gained into how participants were interacting with the loyalty program:

  • Only 60% of best customers redeemed their points within one year
  • Customers found the program complicated and didn’t know how to redeem their points
  • Customers who redeem their points are more likely to stay loyal and spend more in store
  • The regular statement mailing was the best way to encourage reward redemption

The action

Turning those customer insights into action, the retailer decided to:

  • Include reward and incentive vouchers to drive points redemption in the statement mailing
  • Introduce a “Points Meter” to clearly illustrate how much points are worth
  • Improve targeting of offers using new customer segmentation

The results

By understanding not only how customers were behaving, but also understand what they wanted, dunnhumby was able to help the retailer uncover what was holding their loyalty program back and ways to increase its performance. The retailer experienced a 7% lift in the number of customers making point redemptions and a 3% sales increase resulting from the new statement mailings.