How Loyalty Programs Have Changed Businesses
As more businesses understand the importance of improving customer loyalty and retaining their existing customers, loyalty programs are becoming an essential component of every retail store. While loyalty programs can vary across enterprises, all of them are a marketing tactic meant to reward customers for their loyalty. For example, a retail store can give their customers a point card and award them with a free voucher once their points accumulate to a certain level. Businesses may need to allocate their resources towards a loyalty program to make it successful. However, enterprises will yield several benefits if they learn how to create a loyalty program.
You can use loyalty programs to provide incentives to customers and encourage them to make repeat purchases and improve customer retention. Giving loyal customers incentives that are in tune with what they are looking for will draw them and inspire them to spend more money on your products and services. While customers represent almost 70% of the total sales, there are only 13% loyal customers to a single retailer. That means only a few customers are loyal to your services, so it’s essential to nurture them. You can achieve this through loyalty programs, as they help draw more customers and encourage them to keep coming back.
Steward Your Relationship with Your Clients
Many enterprises believe that loyalty programs are expensive, but the truth is, searching for new customers can be more costly than offering incentives to the existing ones. Retaining an existing customer can be seven times less expensive than pursuing new clients. Loyalty programs help businesses to increase their loyal customers, and the concept of earning points has become popular because every customer wants to save money. Beyond monetary benefits, customers wish to be recognized, and this is what loyalty programs do.
Companies can give personalized gifts or something exclusive as their loyalty program. These programs let customers be part of the community as well as the brand. For example, enterprises can make their online shoppers earn points by participating in contents, inviting friends, and sharing ideas on social media. You can also build a loyal clientele by giving loyal customers samples of new products or service before you launch them. Alternatively, invite them to exclusive events that are only for loyal customers.
Attract New Customers
Perhaps you’re wondering how to create a loyalty program to attract new customers. While traditional marketing tactics are still significant, enterprises can think about investing some of the money spent on conventional media towards a loyalty program. Instead of spending all your money attracting new customers, consider ways to retain the existing ones.
Recent research has revealed that many consumers feel that brands aren’t doing enough to recognize their loyalty, and this increases the chances of them abandoning a brand. As such, brands should make customers feel appreciated and give them a reason to stay. Loyal customers are likely to transact with a brand that nurtures its relationship with the existing customers. One of the effective marketing techniques that companies often overlook is loyalty programs. These programs not only help develop a brand image but also increases its sales.