Having a customer loyalty program has become a standard business practice. A loyalty program adds value for your customers by rewarding them for their patronage and encourages repeat business. A loyalty program also lets your buyers know that you care. These programs have extra benefits for businesses. They help to track customer behavior and demographics. Loyalty programs are also a low-cost way to promote word-of-mouth advertising and brand awareness. Here are some tips on creating a customer loyalty program.
Things to Consider Before You Begin
The ultimate goal of your program is to increase business among existing customers and to attract new ones. Develop a strategy by answering some questions.
1. What type of customer do you want to cultivate? Is it the frequent buyer or the customer who buys high-ticket products?
2. How can you match your loyalty program to your brand?
Types of Loyalty Programs to Match Your Brand to Customers
Businesses (such as retailers) that rely on frequent buyers may find a branded rewards card is an ideal loyalty incentive. Customers are asked to opt-in to the program by providing basic information like a phone number or email address They then receive a branded card that is scanned at check out. Customers accumulate points toward future buys or receive discounts on special promotions.
Small businesses can use a variation of the reward card with an old-fashioned punch card. Customers are given a card that is punched at check out every time they make a buy. Customers are entitled to a free item after a number of purchases. This form of loyalty program is often used at cafes and other small venues.
Customers who spend more may be attracted to a loyalty program with a sense of exclusivity. These invitation-only programs provide customers with special access to services. Airlines often use this model with frequent travelers who are rewarded with perks like executive lounges or reduced fares. These types of programs are not limited to airlines. Large companies like Costo offer clubs that give patrons access to discounts and special offers.
Younger customers may be drawn to a loyalty program that is digital. In return for some basic information like an email address, customers receive notices on special offers, new products, advance sales and discounts. Customers apply their purchases to the program through their smartphones or other devices in place of physical rewards cards. Using a digital app for a loyalty program offers several advantages. It is fairly low cost for businesses to use. It tracks customer demographics and buying trends. Digital apps also offer opportunities for social engagement with customers. Some available digital apps include Belly and KeyRing.
Don’t be afraid to look at what your competitors are offering in loyalty programs. Look at what works with them and see what you can offer that they don’t. Start a similar program that adds value or offers something unique. Customers often respond to a physical gift for loyalty. Think about offering a premium in the form of a sample product or service. In today’s competitive marketplace, customer loyalty programs shouldn’t be ignored. They are an important and cost-effective way to attract new customers and keep your current ones.