Digital loyalty cards and customer apps:
How to really reach customers

Digitalisation has fundamentally changed our lives and customer apps are now an indispensable part of modern customer loyalty. However, the reality often shows that many of these apps fail to fulfil their objectives. They are perceived as just another communication channel without offering any real added value. Particularly in sectors where the frequency of use is low, such as textile retail or construction companies, it seems to be difficult to convince customers to use them regularly. But how can companies use digital loyalty cards and customer apps to inspire and retain customers?

Why many customer apps fail

Many customer apps fail due to a fundamental problem: they do not offer any new functions or experiences that go beyond existing channels such as websites or newsletters. Especially in industries where interaction with customers is rare, there is a lack of good concepts to get users excited about an app. So the question is: how can companies design an app so that it is not just useful for customers, but indispensable?

An example of how an app can fail can be seen in applications that only provide coupons or general information. Such functions rarely motivate customers to use them on a permanent basis. Successful apps are those that are integrated into customers' everyday lives and create added value that goes beyond the obvious.

The digital loyalty card as the linchpin

A central starting point is the digital loyalty card. It is much more than an electronic version of the classic plastic card: it becomes a hub for data, interactions and personalised offers. Customers can manage their loyalty points, keep track of past purchases and access personalised benefits.

In the fashion industry, a digital loyalty card could provide styling tips based on past purchases. For example: a customer buys a coat in autumn. The app suggests matching accessories that are currently in the range. In the construction industry, customers could receive discounts on building materials that they order frequently and at the same time manage their project overview in the app.

The particular advantage of this digital card is its flexibility. It offers clear benefits for both the company and the customer. Companies can better understand customer interactions and make targeted offers. Customers, on the other hand, benefit from a customised experience.

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eCash Features and Gamification as Motivation Drivers

To further boost app usage, companies can integrate eCash features and gamification elements. Customers can earn loyalty points not only through purchases but also by interacting with the app, such as sharing content or participating in surveys.

For example:

  • Zalando Zircle: Users upload outfits and earn points when others like them or buy similar products. Points can then be exchanged for discounts or rewards. A construction company could use a similar principle, awarding points for documenting projects or referring other customers.

Gamification adds an extra layer of motivation. Competitions like "Earn 500 points by Christmas" or leaderboards showcasing the most active users create a playful incentive. These elements make the app not only functional but also entertaining

Community-Building and User-Generated Content

An app can be more than just a tool – it can be a meeting place. When customers are actively involved, a vibrant community emerges. This is where user-generated content (UGC) comes into play. Customers can upload their own content, such as a new outfit or a completed construction project, which others can like or comment on.

Examples:

  • Houzz App: Construction companies showcase projects, exchange ideas with peers, and inspire potential clients.
  • Fashion Retailers: Allow customers to share their own looks, integrating them into the brand and increasing interaction and reach, as seen on platforms like Instagram and TikTok.

The community aspect ensures that the app is perceived not just as a tool but as an experience. Customers who feel part of a community are more likely to stay loyal and return.

 

 

Personalization: The Key to Relevance

An app becomes relevant when it caters to the individual needs of its users. Personalized content like tailored product recommendations, discounts, or notifications about current offers make all the difference.

Examples:

  • Fashion Retailers: Notify winterwear enthusiasts about new collections and suggest products based on individual preferences.
  • Construction Companies: Provide information about new materials or legal updates relevant to specific projects.

This level of personalization relies on CRM and ERP system integration, ensuring that customer data creates a bespoke experience. Customers feel the app is made specifically for them, fostering long-term loyalty.

The Illusion of Affordability

A common argument against investing in such apps is that they are not cost-effective. However, this argument does not hold up under scrutiny. Just as physical stores prioritize customer service for an enjoyable shopping experience, apps serve the same purpose as digital extensions of the store.

Studies show that customers with an established relationship with a company have a significantly higher purchase likelihood. Conversion rates for existing customers in digital channels are up to three times higher than for new customers in physical stores. Additionally, app maintenance can often be automated or semi-automated, making it highly scalable.

Seamless Integration: Everything in One Place

A successful app should seamlessly integrate with a company’s existing systems. CRM and ERP integration enables automated data exchange, allowing customers to view orders, earn points, and use personalized offers directly within the app.

Examples:

  • TYRIOS Portfolio App for Construction Companies: Synchronizes project information and lets customers track progress in real-time.
  • Fashion Retail Apps: Allow customers to combine online and offline purchases, managing their wardrobe conveniently.

The Initial Investment: Why It Pays Off

Developing such an app is undoubtedly an initial investment, but it must be well-thought-out to ensure long-term success. A modular approach is crucial. By leveraging standard features like loyalty programs, notifications, or community elements, companies can expand their app as needed.

For instance:

  • Investment: €50,000 in a modular app.
  • Outcome: Gain 500 active users monthly, each spending €20 more on average, generating €10,000 in additional monthly revenue.
  • Result: The app pays for itself within the first year and creates sustainable value.

Conclusion: From App to Loyalty Instrument

In summary, a successful customer app must go beyond being another channel. It must offer real added value, actively involve customers, and cater to their individual needs. Features like digital customer cards, eCash, community-building, and personalization play a pivotal role.

The key is not to design the app from a top-down perspective but to make customers active co-creators. Only then can an app evolve into a long-term loyalty tool – much more than just another channel.

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