28 Nov Customer Loyalty Programs: How They Can Benefit Your Business
The concept of rewarding customers for their loyalty is not a new one, but it is one that is becoming increasingly important as the battle (with your competition) to keep customers coming back to you, heats up.
Reward schemes are great for increasing customer retention, encouraging repeat purchase behaviour and contributing to your bottom line. Loyalty programs are also great at capturing valuable insights such as customer demographics, consumer behaviours and purchase information.
To help satisfy and retain your customers, try one or a mix of the following loyalty programs.
Rebate & Cash Back Programs
These kinds of programs entitle customers to a percentage off or a cash refund for their purchase. The rebate can be given in the form of a gift voucher or as cash. These programs are simple to understand and implement, and their value proposition is easy to communicate to customers.
One of the main advantages of this type of loyalty program is that it allows customers to feel as though they are accruing value and drives them back to a business.
Watchlist: The Cash Back App offers a mutually beneficial cash back program. It aims to reduce the cost of living and to support local businesses. The app allows both consumers and businesses to enjoy discounts, cash back, rewards and special offers and prizes.
With a points program, customers are able to earn points for transactions, visits or engagement. Points-based reward programs work best for high-frequency purchases or interactions.
These programs encourage frequent spend by offering customers the opportunity to accrue points relative to their purchase amount. Accumulating points means that customers may be eligible for free or discounted products.
Watchlist: The Qantas Frequent Flyer Program is one of the most well-known and one of the most widely used points-based loyalty programs out there. Within this program, members are able to accumulate points when they make a purchase with a selected number of retailers and businesses with which they can use to purchase flights within Qantas.
Sometimes referred to as punch programs, these programs are widely used in brick and mortar stores. Many cafes use this type of reward scheme to encourage customers to remain loyal and keep coming back despite a low perceived switching cost. The great thing about these types of programs is that they easy to implement, cost-effective and highly adoptive by consumers.
The idea behind frequency programs is to provide customers with a card with which they can stamp when a customer makes a specific transaction (i.e. buying a coffee). Once the customer has bought 10 coffees, they are then entitled to a free one.
Customer loyalty is paramount to business success. As it costs more to market to and acquire new customers, many businesses find it beneficial to look for ways to better serve their existing clientele. Not only do loyal customers convert and spend more on brands they like and trust, they also enjoy sharing their positive experiences with others.
Need help building a loyal following?
See you next week,
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