At Sunnyside, we continue to see a shift across our industry to a renewed focus on brand building from a pure performance strategy. But often, marketers mistakenly focus only on awareness and acquisition to build brands, forgetting that how you actively move customers to become loyal advocates matters just as much.
A modern approach is needed. Gone are the days of purely trading points for rewards. What’s taking its place? Data-driven, AI-powered programs that actually mean something to your customers. They include personalized, exclusive rewards that people genuinely want.
Why the renewed focus on loyalty? After all, loyalty programs are nothing new.
It’s because in a world drowning in ads, promotions, and endless choices, loyalty isn’t a nice-to-have. It’s a key retention tactic. The old “points-for-prizes” game doesn’t cut it anymore. Modern loyalty programs today are about creating real connections that keep customers coming back (and spending more), effectively boosting the efficacy of your paid acquisition efforts.
The numbers back it up. A 2023 Bond Loyalty study showed that 65% of consumers change their buying habits to maximize loyalty rewards. That’s not a small nudge, that’s behavior change. And for brands that get it right, loyalty programs can boost revenue by 5%-10%. Some even more.
Still not convinced? Consider that acquiring a new customer costs five to 25 times more than keeping an existing one (Harvard Business Review). Loyalty programs can slash those costs while increasing the lifetime value of your customers. In fact, for some brands, loyalty programs drive up to 40% of total revenue.
What’s even more exciting is that we’re learning new ways to integrate AI into how these programs work. AI loyalty tools can enable brands to:
- Predict which rewards each customer actually cares about.
- Serve up hyper-personalized offers.
- Fine-tune programs in real-time, based on customer behavior.
Imagine not just rewarding your customers, but anticipating their needs. That’s where we’re headed.
I recently had a conversation with Florence Marine X about their loyalty and membership program. It’s setting a new standard not just in the surf industry, but beyond. Check out the interview in a recent post on my LinkedIn profile.
More and more brands are asking us to help redesign their loyalty programs. If you’re ready to rethink how you treat your loyal customers, let’s talk.
Matt Raminick is the founder & CEO of Sunnyside, a marketing partner for surf and coastal lifestyle brands. Prior to founding Sunnyside, Matt held senior digital marketing roles at Quiksilver, Volcom, and Pacsun. He can be reached on LinkedIn and at matt@sunnysidecalifornia.com
