What You Need to Know about Loyalty Programs
A loyal customer is invaluable to any business, but loyalty is something businesses have to earn – both through exceptional service and rewarding those who stick with them. So let’s dive in and take a closer look at what makes for effective loyalty programs and how they can foster truly formidable relationships with your best customers and clients.
Loyalty Programs a closer look
In your day-to-day life, no doubt you’ve encountered loyalty programs. They can go from very basic, fundamental perks to more extensive rewards. A common example is a coffee shop. If you frequent a café, they might give you a stamp card where after purchasing nine coffees your 10th one is on the house. It’s a simple perk that helps incentivize customers to come back.
Loyalty programs can be far more extensive, though. And, naturally, if your business deals in bigger products or services than a $3 or $4 latte, then the reward for a customer’s loyalty should be more substantial. That said, if the primary aspect of your business is them buying high-value products from you each month, then perhaps offering those products for free or at a significantly reduced cost one month to say thank you could do the trick.
Going Beyond Points
Now, while many companies can inspire loyalty with a stamp card or a point system, it is worth being mindful that offering more of the same may not always be a failsafe option. Many businesses, such as Virgin and Amazon (the latter of which I will be discussing further in the next section), have evolved their loyalty programs to have a more stated sense of loyalty and reward.
This kind of loyalty program can push beyond a mere point system, and introduce tiers. Are you a bronze, silver, gold, or platinum member? Each tier can have varying perks that suit different people. Perhaps bronze is for customers who earn a more average wage while gold and platinum are reserved for higher income earners.
But tier systems don’t just have to be opt-in. Tiers could be informed purely by the longevity and lifetime investment of a loyal customer. Have they spent $1,000 with you? Maybe they get a $50 gift card. What about when they reach $5,000? Perhaps they can select one product/service of 20 you’ve listed that equates to $200 in value. Then if they spend $10,000, you can send them on a trip or cruise with a nice travel reward.
It’s important that, no matter how a loyalty program works for you, you maintain transparency. Because when a customer knows exactly what they can get from spending X amount with you or buying a set product X number of times, it gives them unambiguous goals to go for. When a customer has no idea how your loyalty program works, they’re less likely to get into it.
A “Prime” Example
While it can be pegged, in part, as a subscription-based service, Amazon’s Prime service feels like far more than just that. The initial focus of Prime was on faster deliveries for free. People could sign up to pay a yearly fee that would grant them access to a host of two, one, or even same day delivery items. They could order as often as they wanted, as much as they wanted, and have access to one or all of the aforementioned delivery options.
For those frequented Amazon for a large portion of their shopping needs, Prime was a no-brainer. That yearly fee paid itself back and then some. Since its initial release, Prime now also includes features such as access to video streaming service Amazon Video, music streaming, ad-free Twitch (a live-stream service), and even exclusive discounts on certain products
While you can argue that Prime is no more than an annual subscription service, it’s a service that drives loyalty. Prime differentiates the company from many of its past and contemporary competitors, and the perceived value is significant. Add to that Amazon’s renowned history when it comes to good customer service – a factor of critical important to Amazon’s CEO, Jeff Bezos – and you have a program that continually rewards and incentivizes customers for their loyalty.
Retaining Loyalty at a Brick and Mortar Location
Retaining loyalty from a customer goes beyond predefined programs or rewards. Those perks are certainly effective, but they’re not the be all and end all of why someone chooses your business over a competitor’s. A large part of fostering loyalty can come down to the fundamental experience of what it’s like to do business with you.
It’s this aspect that helps reinforce the value of good service, no matter whether you’re B2C or B2B. How you treat your customers and clients is going to influence their connection with you. Granted this is an obvious point, but it’s a fundamental of loyalty. For example, I used to go to a specific service bay near work every time I needed an oil change, and within the first few visits, the technicians who did the morning shift already knew the most likely reason as to why I was dropping in.
That familiar casual question of “The usual?” is one that is symbolic of you forming a degree of loyalty to a place. But, interestingly, it wasn’t the offer of a free oil change after X number of oil changes that earned my loyalty – so what kept me going back there? Well, it was the service – plain and simple. The employees were friendly, they were great at their jobs, and they would havefollow-up questions to things I mentioned in passing during previous visits.
But what’s important to keep in mind is that there were other dealer and independent service bays just as close to work. But I chose this one over them because I felt like I was more than a customer. If they hadn’t realized I was a regular and if they hadn’t continued conversations at the point where I left off prior, then I would’ve felt no connection or loyalty to them.
Experience is fundamental. You build a connection and an almost subconscious sense of loyalty in your customers. It doesn’t require some masterplan or deception; it simply requires you to make your customers know you care.
Craft the Ultimate Loyalty Program with Travel Incentives
For 20 years, Odenza has specialized in travel incentives. At little cost to you, the perceived value they can have for your customers is unrivalled. That’s why they’re such a great option as a reward for those who are consistently loyal to your business. Imagine the surprise and elation they will feel when you hand them a travel certificate for a trip to Las Vegas or a luxurious 7-day cruise.
When implementing rewards such as these to an overall loyalty program and strategy, you can development a relationship with your customers that is rarely achieved by your competitors. To find out how our travel incentives can make your loyalty program shine, contact us online today or call us at 1-866-883-2968.