Loyalty programs are everywhere these days; from big businesses to local retail stores. Businesses now understand that retaining current customers is more profitable for a company rather than gaining new customers.
In fact, according to a study, acquiring new customers costs five times more than nurturing existing customers. Hence, companies are investing more in offering extraordinary value to their customers and keeping them loyal to the brands.
Most of the time customers are offered some kinds of rewards such as points, coupons, discounts, cash back, etc. to keep getting repeat business from existing customers.
What are Loyalty Programs?
Loyalty programs are structured marketing strategies to increase repeat business. Usually, merchants introduce schemes in the market that entice customers to make repeat purchases.
Generally, loyalty programs are customized to match the explicit needs of your business. Each time the program is designed, customers are at the focal point. Depending on your industry verticals and the demand of customers, a loyalty program is intended. For instance, retail businesses are offering loyalty cards, which add points after you make any purchase. Also, customers can redeem those points on their next purchase.
5 Steps to Create a Loyalty Program
As every business is unique, a loyalty program should be unique according to your requirements. Go through this article to get detailed knowledge of creating a loyalty program that generates fruitful results for your business.
First and foremost, you should ask these questions before creating the loyalty program.
1. Does your business need a loyalty program?
2. When is the right time to launch the program?
Once you understand whether you need to introduce a loyalty program to boost your sales, you need to follow these five steps to create a successful rewards program.
1. Understand your audience
When you are creating a program to reward, potential customers, you need to understand what they want. Obviously who does not like to get free perks and rewards? But, if you know exactly what your customers are looking for, you have add-on benefits to increase sales.
Before implementing the program, do research about what your customers would like to receive as a free gift. For instance, when you provide what customers like, you are not only getting more business but also building strong relations with the customers.
A giant banking service provider in India, ICICI Bank offers rewards points when a customer uses the bank’s credit card to make a purchase.
In addition to the purchase, the terms & conditions are also in favour of customers such as no limit to earning rewards points, no expiry of the earned points, and many more.
2. Offer a distinct value
Create a loyalty program strategy that offers exclusivity. By administering rewards, you are inviting sales along with providing distinct values to your customers.
As a rule of thumb, humans would like to make repetitive actions, if they find some kind of value in it. You understand your customers, products, and services better than anyone else, so leverage that knowledge to create an elite valuable experience for your customers.
Further, most successful businesses offer customers a discrete value, which is why they are victorious. For example, because of its unique proposition, Apple is one of the most successful American multinational technology companies.
The company always offers values of uniqueness with the different features of mobile devices to their target audiences. Hence, your loyalty program should have a different yet essential value proposition for your customers.
Suggested read: Top 10 Enterprise Loyalty Program Software in 2023
3. Strive for a mixture of rewards
The mixture of rewards is another way to add more value to your loyalty program. Other than offering a discount, you should use various reward options such as free tickets to the event or movie, organizing a contest, free subscription to products or services, etc.
Depending on the type of your business, and industry vertical opt for multiple customer loyalty programs to gain more brand-loyal customers.
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4. Establish customer engagement agendas
You need to let your customers know about the loyalty programs you are offering. Hence, you should make multiple ways to keep them informed about the program.
You may use different ways to keep your consumers about the loyalty program including email, direct mail, SMS, social media posts, advertisements, etc.
Moreover, customers easily forget about the earned points, so remind them to use the programs. For this, you can use any strategies that are convenient for your business. As execution is the most crucial part of any process, identify and define the strategy you are going to use for the loyalty program.
5. Add social connections
Combining a social component with your loyalty program is one of the most immeasurable ways to keep customers coming back. When you establish a substantial community around your brand, customers will have grounds to connect with your company. Be it transform monetary benefits or gifts.
With the chat rooms and forums, you can always gauge what your customers like and what they think about your brand. Moreover, it also gives you the enormous benefits of word-of-mouth publicity. This is an exceptional step for a loyalty program, although it can generate actual acumen and longevity. So, whenever you are about to launch a loyalty program, do not forget to include social connections.
The bottom line is that a loyalty program is essential to keep retaining your current customer base. In order to increase the brand’s loyal customers, you should offer them some kinds of rewards. Thus, loyalty programs are introduced in the market which is a great way to get repeat business from your potential customers.
Do you want to adopt a loyalty program for your business?
LoyaltyXpert offers eminent loyalty programs for your business that will help you extend the scope of profitability. Our expert team will analyze your business offerings and according to that, we deliver a customized solution for your business.
We offer loyalty programs that help to retain more customers for every brand. If you want to know how we can help, contact us today to get a free demo.