21 Feb What the Best Loyalty Programs Have in Common
Loyalty reward apps like Pirq are a great tool to improve relationships with your customers and drive sales. There are, however, some right ways and some wrong ways to go about implementing a loyalty program. Taking into consideration how successful loyalty programs operate can give you a competitive advantage in your market as you create your own loyalty program.
Make it Convenient
The number one obstacle stopping customers from adopting your rewards program is misconception. Traditional reward card programs make customers jump through hoops to sign up, but new models, like Pirq, are easy to join (Simply text “VIP” to 33133 to download the Pirq app!). Making enlistment simple is essential to starting a successful rewards program. Customers need to be informed about how easy it is to sign up for your platform.
Avoid forms, physical cards, and excess time consumption.
Cashing in rewards should be as easy, if not easier, than signing up in the first place. Providing a seamless customer experience makes for happy customers and increases the likelihood they’ll become an ambassador of your brand.
It should take no more than ten seconds for a customer to start a punch card or add a punch. With just a simple text or scan from your customers, your customers should be able to receive a punch, and be off to continue with their day. A complicated and/or time-intensive process will ultimately turn off your customers and bring your loyalty program to a screeching halt.
If it takes more than a few seconds to redeem rewards, rethink your system.
According to Don Peppers at Fast Company, “the fewer rules and restrictions you have, the more engaging your program will be for the customer. It’s better to narrow your offers to those you can deliver consistently, rather than including elements that can’t be relied upon.”
Target Your Rewards
Don’t waste all the data your rewards program has to offer. The kind of metrics provided by Pirq will allow you to offer different rewards and see which receive the best response from your customer base. Created a tailored rewards program that offers flexibility in which rewards are offer will help your program grow and evolve as trends and buying seasons change. The most successful rewards programs leave no stone unturned and work constantly to improve your sales.
An effective program offers modularity, enabling participants to mix and match aspects to their own preferences.
And don’t forget to use your rewards program as a marketing tool for new products and services. Remember, a rewards program doesn’t just reward past behavior, it can help influence future behavior.
Understand Your Data
Understanding your data means understanding your customers. Insight into customer behavior allows your marketers and sales teams to better align their strategies, allowing them to make better informed decisions.
Don’t waste data. It shouldn’t be examined quarterly, but frequently, so that programs can be altered and tailored to what’s going on in your business in real-time. Understanding data also means understanding where the data could go next. This type of insight is essential in maintaining or improving your place in the market.
According to Dan Frechtling at RetailWire, “local digital rewards can generate 20 percent more trips and 10 percent higher orders.” He goes on in his research to point out that reward apps don’t need to offer incredible discounts in order to be effective.
Typically a small, but valuable incentive is enough to retain current customers.
Compared to pure daily deal promotions, which typically require a drastic reduction in price, a loyalty reward can attract customers without forcing your business to give something away for free or at a loss. Reward card apps can cost you less but provide the customer with a similar level of engagement while also increasing customer retention.
Make Customers Happy
Customer happiness should be your number one priority. According to Deloitte Consulting’s Robin Athey in his 2010 book Serving the Networked Consumer: Strategies for Multi-Channel Marketing and Commerce, a 5% increase in customer retention can double your profits. Acquiring new customers is roughly six and a half times more expensive than retaining current customers. The amount of potential revenue from on-the-fence customers is staggering.
Your business should be laser-focused on retaining current customers as well as bringing in new ones. A revolving door attitude about customers might translate to gimmicks and foot traffic today, but will be exponentially more expensive in the long run.
Customers loyal to the brand can become your best advertisers. According to Modern Retail Pricing, a popular blog on the cutting edge of commerce, more than half of consumers in North America rely on social media to gather shopping ideas. As social media and sharing sites become more ubiquitous, that number is bound to rise, especially among the savviest of consumers.