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Benefits of Loyalty Programs in a Cookieless World

6 minute read

Google may have delayed the ultimate death of the cookie, but that doesn’t mean marketers can breathe easy. Brands have relied on third-party cookies for behavioral targeting and remarketing campaigns for decades. Change won’t come easy. 

There’s no plug-and-play replacement for third-party data on the horizon. Even though Google is putting the final nail in the cookie coffin, Apple and Firefox banished their use years ago. The heightened awareness around ethical data collection and privacy concerns means brands will need new ways to segment and activate their audience. 

That’s where loyalty programs come in. Strong brand loyalty programs are built on first-party customer insights, and present a wealth of opportunity to grow your data assets for targeted campaigns. If a loyalty program isn’t part of your marketing strategy today, read on to find out why it should be. 

The brave, new cookieless world

There’s no avoiding the fact that cookie deprecation will have a major impact on the way brands implement and manage marketing campaigns. Third-party cookies were the gateway to targeting consumers—observing the websites they visited, the products they bought, and even their interests and affiliations. 

They also enabled accurate campaign measurement and attribution. Brands could track conversions to a particular ad and have deep visibility into ROAS. Cookie deprecation puts an end to reliable multi-touch attribution models.

With the fall of reliable multi-touch attribution, marketers need a way to make sure they have accurate, repeatable, and affordable ways to measure the incremental impact and return of ad spend on each channel.  

Brand loyalty programs can be a treasure trove of insights

While consumers view unauthorized third-party data collection with disdain, they are typically willing to volunteer personal data for something of value. A recent YouGov poll showed that 88% of US adults would happily share personal information with brands if they received discounts, free products, or rewards in return. 

That makes brand loyalty programs the perfect vehicle to collect meaningful, and accurate, customer insights at scale as part of a value exchange. Because loyalty programs are designed to cultivate repeat customers, the insights they generate can be used to enhance personalization efforts and build a better customer experience. 

Of course, the pivot toward loyalty programs as a way to replace third-party data requires some agility in marketing tactics. The ‘awareness to conversion’ journey must be replaced by a ‘conversion to advocacy’ journey to maximize the program’s value. While a brand’s most loyal customers make up just 20 percent of its audience, they typically generate up to 80 percent of its revenue. 

Brands can use a rewards program to build a loyalty bridge that turns their best customers into advocates. A properly designed and executed loyalty program is a powerful owned-media channel that builds engagement, grows market share, and drives sales. 

Accelerating brand loyalty programs with Cardlytics 

Most brands have a good grasp of who their customers are when they’re making a purchase with them, but they lose visibility once the transaction is complete. Brands have no idea, for example, what share they’re getting of a particular customer’s category spend or just how loyal their ‘loyal’ customers really are. Without that insight, they run the risk of spending money where there is no headroom.

Because Cardlytics partners with top financial institutions, we have a “whole wallet” view of consumers, with insights into how, when, and where  they spend both in and out of the store. Armed with this first-party data, brands can deliver targeted offers to their most loyal customers, increasing their lifetime value. They can also re-engage lapsed customers with compelling offers designed to turn them into loyal fans, thus expanding market share.

It’s a win-win for brands and customers. Brands have more efficient use of ad spend with the same or better visibility into performance as third-party cookie campaigns. Customers get reward offers that make them feel valued, increasing their loyalty as a result. 

Brands with loyalty programs are a giant leap ahead when it comes to a cookieless future. That’s because responsibly managed first-party data will become the only path for brands to grow their audience, market share, and sales once the cookie crumbles.

Get in touch to learn more about how partnering with Cardlytics can turbocharge your loyalty efforts and increase sales. 

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