Unpacked: Why brands and retailers like Sephora and Adidas are merging loyalty and promotions

"Loyalty, promotions and discount programs are moving up the C-suite agenda as more brands bid farewell to mass markdowns and say hello to tailored, data-driven incentives to build customer loyalty. "The building blocks of a loyalty program are about getting benefits from being part of a program and your interactions with that company," said Emeline Berlind, svp and general manager of loyalty at Sephora, speaking on a podcast with Talon.One. But many leaders are still at a loss for exactly how to create an incentives strategy that combats rising customer acquisition costs, enhances customer retention and creates predictable revenue streams - especially in a competitive market."

""CMOs and CEOs tell us that they want to discount less, but that only happens when they're thoughtful and lean into it," said Christoph Gerber, co-founder and CEO at incentives platform Talon.One. "We frequently see across otherwise sophisticated businesses that discounts and loyalty are a neglected part of the marketing estate. That C-suite neglect only breeds more discounting. It's this paradox of needing to lean in to do less.""

Brands are shifting from mass markdowns to tailored, data-driven incentives to build customer loyalty and differentiate in competitive markets. Siloed discounts, promotions and loyalty programs drive excessive discounting, higher customer acquisition costs and weaker retention. A unified incentives strategy integrates loyalty, promotions and discounts through shared data, orchestration across channels and measurable experimentation. Executive attention and governance are required to reduce blanket discounting and replace it with targeted incentives that drive predictable revenue and higher customer lifetime value. Personalized, seamless rewards tied to customer interactions create stronger loyalty and clearer business outcomes.

Read at Modern Retail