Customer Loyalty Programs and Your Local Business
You’ve probably participated in a customer loyalty program. Many famous businesses have them, like Starbucks and Best Buy. In fact, both companies said that implementing their customer loyalty program has increased their bottom line.
These programs have their benefits. You may think, as a small business owner, that they’re too complicated to employ. That’s simply not true. You can make a customer loyalty program work for your small business. It’s not out of your reach. In fact, you’d be surprised at how easy it is to employ one.
Making it work, however, is a different story. It’s not impossible, but it will take a little bit of careful planning, and a lot of hard work.
What Is a Customer Loyalty Program?
A customer loyalty program rewards repeat customers for continuing to buy from your business. It can be as simple as a punch card that allows you a free sandwich for every 5 you buy. Or it can be a program that allows you to accumulate points towards a prize. It doesn’t matter how it’s implemented. The point is that the customer gets something in return for their patronage.
Why Customer Loyalty Programs Are Important
You’ve probably heard that 80% of your business will come from repeat customers. So embrace it!
Customer loyalty programs help you obtain repeat customers. People love rewards. They will shop with you as long as the reward is something that is worth it to them.
Loyalty programs can be used for almost any type of business. Businesses in the food, health and electronics industry benefit from loyalty programs the most. However, that doesn’t mean that if you’re outside of this industry you can’t use a loyalty program. You just may have to be a bit more creative with how it works.
Choosing Rewards for Your Customer Loyalty Program
What type of reward you offer your customers will determine how many people sign up for it. If it doesn’t appeal to them then there’s no reason to sign up. So what should you offer as a reward?
Most businesses go with a free item. It could be a sandwich, a drink, or even a tanning session. You can also offer a percentage off. GNC offers a percentage off to Gold Club members on a certain day of the month. Even though you have to pay to get into the program, it works. If you pay to get into the program you’re going to make sure you get your money’s worth. That means you’re going to spend your money at the business whenever you get a chance. This helps GNC retain customers and keep them coming back.
Another idea is to partner with businesses that compliment yours. You can all use your loyalty programs to gain new customers and reward repeat ones. Let’s say you run a tanning salon, and there’s a gym and a spa in the area. Perhaps you can suggest to the other businesses that you set up a loyalty program together. If you buy 2 sessions from each business, you’ll get one session from a business of your choice for free.
Can you imagine the impact that would have on your business?
Just make sure that your rewards are actually attainable. If people have to make 100 purchases to see their reward, they’re probably not going to bother going through with it. A small amount of purchases are best. Try to stick to something under 10.
If it’s over 10, make sure that the reward is worth it. Perhaps after 15 purchases you get $50 off a $75 purchase. Or you can give them free tickets to a local sporting event. As long as the reward is reasonably attainable, people will work for it.
The Top Customer Loyalty Programs
Here are the top four programs for small to medium sized businesses.
Swipely: www.Swipely.com offers a loyalty program and aggregates data for you. It’s free to use, but you have to use their POS in order to get into the program. The data that they gather tells you things like whether your sales are working, what your most popular items are, and who your top spenders are.
The loyalty program actually gives cash back to customers. That’s a pretty good incentive. For business owners, you can monitor your online reputation, campaign effectiveness, and your financial data. In truth, Swipely gives you a ton of features. The loyalty program is great; users haven’t reported any problems in it. But the fact that they help you manage your business while gaining new customers makes them one of the best loyalty programs.
Belly: www.bellycard.com Belly is easy to use. They are a rewards card program. They set everything up for you. You even get an iPad with the system installed on it when you sign up for their program.
They give you analytics, email marketing options, mobile marketing, and everything else you need in order to run your loyalty program. While you can’t get the kind of analytics you get from Swipely, you will get pretty solid information about your customers spending habits and how it effects your business.
Belly plans start at $99 a month.
Five Stars: www.fivestars.com This is a pretty simple rewards program. Once you sign up for it, they do all the work. Using this program, customers only need to put in their phone number to sign up. No one needs anything special to become a member.
Another plus is that they use automated campaigns. They contact customers that haven’t been to your store in a while an offer them incentives to come back. They also have a birthday rewards program. Five Stars pretty much runs your loyalty program for you.
There’s no pricing information on the website, but you can try out the demo for free.
Loyalty programs can really help your small business thrive. Sometimes it’s difficult to compete, especially if there’s a national chain in the area. But a loyalty program can help encourage people to keep coming back to your store.