Is customer loyalty vital for pharmaceutical business? For successful pharmaceutical businesses the answer is obvious: customer loyalty is a major driving force. Here are a few convincing arguments:
- Engagement with pharmacy customers through loyalty programs and education enhances the awareness about their diseases and medications you sell. Pharmacist’s professional advice and loyalty program rewards make customers attached.
- Loyalty program points can be accumulated (or multiplied) for purchasing specific brands or products.
- Loyal patients are best brand advocates and ambassadors. The word-of-mouth marketing is the best a pharmacy or a drugstore can create, as it may be more valuable than professional physician’s advice.
Why loyalty program is a golden key to sales increase and building trust to your company in pharmaceutical industry? Let’s find the answer.
Fresh statistics on reward program effectiveness in the pharmaceutical industry
70% adult US residents are members of at least one pharmacy/drugstore loyalty program. This is second most popular result: the top sphere is grocery retail with 74%.Forrester’s research 2016
In other entries of VALFOR blog you can find enough impressive case studies on starting loyalty programs in branded mobile apps. It is especially relevant for pharmacies and drugstores: searches for “pharmacy” apps provided by specific retailers have increased 140% – shares Google.
Customers are seeking for more interaction with pharmaceutical businesses, additional information about healthcare, discounts and bonuses.
Top market players in the US, such as CVS Health, Walgreens and Target have well-developed loyalty programs. Some of them we are going to consider below. If you haven’t created one already – it’s the time to start.
At this point it’s time to pay attention to the quality of rewards and their effectiveness.
Not all rewards programs are created equal
Let’s analyze consumer behavior and preferences: the research by Forrester shows elements of loyalty programs people find important. That was quite predictable that 80% of customers consider discounts important, but there are some other perks that matter: 53% of customers are willing mobile coupons and other types of digital redemption certificates, mobile gift cards etc. to have them handy for convenient use. This is also easily doable with a mobile app.
Also, don’t forget people are still interested in points, miles and other loyalty currencies, as well as in premium service and status (reward program tiers). However, you can try differentiating rewards by offering less-generic options. Perks may vary from priority service in a queue to a free cup of herbal tea or pill testers.
It’s not about high-pressure selling anymore
Successful loyalty programs imply engagement and personalization instead of plastic cards with pre-defined discount. Try to be closer to your customers through omnichannel interaction. An outstanding example of personalization in pharmaceutical industry is Novartis app that helps people monitor their health condition and personalize their experience with the brand. Customers are likely positively respond to recommendation engines and customized informative newsletter.
McKinsey and Company, marketing/sales researchers, suggests starting from a clear sense of purpose. What your loyalty program should basically provide? You may strive for winning new customers, increasing the average check, saving money on ads etc. Set your goals and develop a loyalty program with its regard.
Rewards help keep existing customers satisfied: and this is a lot easier that persuading new customers to come in. The famous Pareto efficiency rule can be applied here: 80% of your income comes from 20% of your loyal customers.
Case study: Walgreens
Walgreens’ loyalty program has everything it should have: simple but versatile reward system, multiple opportunities to receive and redeem bonus points and exclusive promotions for loyal customers to help them feel valuable and special. There are 5 major inspiration ideas:
- Boost sales in sections you are most interested in: Walgreens offers 5000 points for every $50 spend on beauty products.
- Prioritize brand ambassadors: exclusive offers for members only.
- Show them you care: Walgreens Balance Rewards for healthy lifestyle, 20 points per mile of walk, weigh-in, most popular health check tests or quit tobacco use. Additional points on prescriptions and immunization.
- Go mobile and encourage following you: digital coupons in weekly ads.
- Promote omnichannel shopping: special points for online and in-store purchases. “Customers who shop in-store and on mobile are six times more valuable to us than those who shop only in a store” – says Deepika Pandey, Chief Digital Marketing Officer at Walgreens Boots Alliance, in her interview to Google.
Case study: CVS Health
This American pharmacy and healthcare company appeared among top-3 Most Innovative Companies 2016 due to digital tools implementation that facilitated routine tasks of customers. Chief Digital Officer at CVS Health says the company is focused on building helpful tools to solve real problems and ‘pains’ of potential customers. About 5% of all Google searches is for healthcare information, – he adds.
In addition to their quite a standardized loyalty program, CVS/pharmacy has developed a mobile app to enable customers:
- Integrate it with Apple Watch App;
- Set reminders on taking meds, ordering refills or visiting their healthcare providers;
- Enter and update the insurance carrier information;
- Receive in-store app messages about medications ready to pick up and a lot more.
The brand carried out its own research to take a decision on the increase of investment in digital development. According to it, people who use CVS tools are much more likely to adhere to their medications and fill their prescriptions, i.e. are valuable customers. These data led to the fact CVS Health increased their mobile development financial support 5 times.
Before developing a rewards program for your brand in pharmaceutical industry, think of micro-moment to win. Besides discounts and bonus points, your potential customers are interested in detailed information, advice and convenient interaction with the brand. Mobile development helps to solve multiple tasks at once: your app can help deal with lot of real customer problems via reminders and notifications and be a loyalty program keeper to replace another plastic card in the wallet.
Let VALFOR be your guide in the rapidly changing digital environment. We help create highly valuable customer experience and transform it into enhanced sales, involvement and brand recognition. We implement SCRUM-framework and think twice before taking the next sprint. Customer approval and detailed feedback are a must at every development stage. Own premium digital products – with the help of VALFOR experts.