3 ways brands can beat Amazon at the loyalty game

Amazon recently joined Apple in “the trillionaire club” when its valuation reached that coveted number. It’s a milestone neither of them would ever achieve without their massive customer base. Amazon Prime, for one, has more than 100 million members in the US alone. But Amazon also won loyalty through sheer breadth in product selection, logistical convenience and competitive pricing.

Amazon’s impact on consumer expectations has never been so apparent than in a recent survey of American shoppers on brand loyalty that my company, Yotpo, commissioned. The findings revealed a preference for what Amazon typically brings to the table. For example, in return for their loyalty, most consumers want frequent discounts (71%) and free shipping (58.4%). The same is true for getting someone to buy from a brand for the first time--the top drivers for a first purchase are fair pricing (64.5%), free shipping (61.3%) and online reviews (57.3%), yet another Amazon staple.

Brands can offer all these things, and many do, but to woo customers from Amazon and onto their home base, they have to offer more. Actually, I take that back: brands need to start thinking hard about offering customers their best. The only way to go beyond the transaction-based engagement Amazon is so good at is to cultivate the emotional connection that drives consumer loyalty.

But is there room in the consumer’s heart for anything besides Amazon? Of course! Survey findings also reveal that an overwhelming majority of shoppers feel equally or more loyal to brands compared to last year. The surging success of direct-to-consumer brands attest to this too, with the likes of Glossier (who declared it won’t sell on Amazon) and MVMT (the indie success story acquired by Movado) earning an impressively devoted consumer following.

With definitive proof that consumers crave to commit to brands, here are three ways brands can cultivate and lock in customer loyalty:

Treat every touchpoint as an opportunity to win or lose loyalty

Consumers won’t remain loyal to a brand just because it’s popular; the product and its quality remain the most important factors. The product is both the point of entry and departure for brand loyalty, perhaps a validation of the “hero product” concept that is the specialty of modern direct-to-consumer brands such as UNTUCKit, Quip and Away Travel. Above, beyond and inclusive of product, though, is the customer experience.

As Maya Angelou observed: people won’t remember what you do or say, but they will remember how you make them feel. This is no less true in commerce than it is across other aspects of life. When it comes to customer experience, really think about what "every single touchpoint" means -- -it’s not only email, on-site experience, imagery, etc., but also shipping speed, packaging and customer service.

Find ways to get personal, if not outright personalize, wherever you can. With so much customer data now available, there is no excuse not to. Over one-third of survey respondents say that in return for their loyalty, they want custom recommendations and promotions. In thinking holistically about the full experience, brands should take the same approach with loyalty programs too and take care to make the right type of offer to the right person at the right time.

Prioritize more than points for your loyalty programs

Building lasting loyalty requires more than just giving people points for purchases, which makes the brand-consumer relationship feel a lot like a transactional exchange, especially over time. Brands should explore and test a variety of ways to reward customers loyalty. For example, 43.4% of customers appreciate gifts and swag from a brand; 26.2% vote for VIP access. This is not to say that points are meaningless, but brand should think about different aspects of the customer experience: Do customers write reviews? Would they consider sharing a review on social media? If they love your brand, would they want to recommend a friend? Extend those points to incent customers for advocacy. After all, the number one thing customers would do for a brand they’re loyal to is tell friends and family!

Remember that loyalty is a long-term relationship

Loyalty isn’t spontaneous, and it can take a while for a brand to cultivate a true “loyal” relationship with a consumer. Almost 4 in 10 survey respondents indicated they purchase from the same company more than five times before they consider themselves to be a brand loyalist; 33% will jump on the loyalty bandwagon after just three purchases. (Why four isn’t a factor escapes me.) Brands have to prioritize the right elements to drive those repeat purchases, and savvier direct-to-consumer brands are using strategies such as leveraging data to re-engage after purchases and emailing when products previously purchased go on sale.

As exciting as it must be for Amazon with that giant valuation, I think commerce today is an even more exhilarating and transformative time for brands. But, to win, it’s important to understand exactly what makes want to people to connect, and the answer lies beyond just shipping and price. Brands can only gain that insight by establishing a direct relationship with their consumers, developing a deep understanding of each customer and rewarding their commitment with superior experiences and thoughtful benefits.

In my eyes, it’s a great time to be a brand... and a customer.

Tomer Tagrin is the co-founder and CEO of Yotpo, the leading commerce marketing cloud for brands like Thinx, 1-800-Flowers.com Inc. and Third Love.

If you enjoyed this article, sign up for SmartBrief’s free e-mail from the Mobile Marketing Association, among SmartBrief's more than 200 industry-focused newsletters.