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Loyalty programs yield high-quality data for direct marketing

Rachel Wheeler Archive

Businesses today face a complicated twofold challenge when it comes to analytics. On one hand, they want to collect as much information as possible about their customers - not just their current ones, but their prospects for future business as well - but on the other hand, they have to worry about data quality. They're trying to get their hands on tons and tons of data, but they also need it to be accurate.

In their quest, many companies choose to migrate their old marketing and sales databases into newer, more advanced platforms, combining them with their email and social media marketing contact lists. This offers a tantalizing volume of data, but it also raises serious questions about accuracy. What if all that old information is outdated, duplicated from another database or riddled with human errors from sloppy data migration?

According to Business Spectator, there's one solution that's proven to work - emphasize data culled specifically from customer loyalty programs. This information is usually cleaner and reflects paying customers who likely show great promise.

The value of loyalty programs
When people sign up to become regular customers with their favorite brands, they can't do so without supplying a good deal of information about themselves - their interest in the company, their purchasing habits and of course, their contact information. This data can go a long way toward helping companies shape their strategies.

Business Spectator examined this phenomenon from the perspective of Qantas Loyalty, which recently purchased the loyalty program specialist Accumulate. Steve Cox, the company's managing director, says the move has done a lot in terms of adding sophistication to the business' data.

"There was so much more that we could do with that data in terms of engaging with that group of customers," Cox told the source. "Like many retailers, we just didn't have the computing capacity and the staff available in-house with the experience to really leverage this great asset."

Quality and loyalty both
Now they do. And furthermore, they also have employees who have pledged their interest in the brand and are likely to stick around for the long haul. People who sign up for loyalty programs tend to provide accurate information about themselves, since they want their favorite brands to have the right data about them, and they're also willing to contribute to stronger brand relationships.

For companies, this is the double whammy - better customers, and better data about those individuals as well. It's a win-win.