The secret recipe for a successful customer loyalty program
What is a loyalty program and why is it important?
Just as the name implies, a loyalty program is about loyalty, meaning the customer chooses your products, your web shop, your services or your company over everyone else's. A loyalty program refers to a system that rewards the loyalty a customer has. The rewards can take different forms, for example better prices or special customer events.
The loyalty program can have several purposes. For example, it may be about getting customers to become ambassadors for your own brand. This means that customers like your company so much that they talk about it with others, get involved in the business or in some other way spread a good reputation. Another purpose could be to use the loyalty program for marketing, for example, by offering slightly better prices on the products that the specific customer often buys or could be interested in. This is an excellent opportunity for additional sales.\
The loyalty program can be designed for both consumers and other companies. A large clothing manufacturer that sells their clothing to different retailers can use the loyalty program to create better customer relationships, for example by having slightly better prices and margins for retailers that have been customers for a long time or that buy a sufficient amount each year.
Loyalty programs can increase sales
From a marketing perspective, loyalty programs are worth gold. Depending on how they are designed, they give you access to people who already like your company and who are most likely interested in the services or products you offer. However, it’s not always like this. Someone who recently bought a car may not be keen to buy a new car in the next few years. However, it may be interesting to get a better price for services such as car service, car wash or tire change.
It isn´t uncommon for loyal customers to share why they like your company so much. If someone you know recommends a service, a product or a company, this weighs much more heavily than traditional advertising. There are many things to keep in mind when designing a customer loyalty program that suits your own company and business.
How to create a good loyalty program?
There are different ways to create a program to reward loyalty. Start by analyzing the customer. Are your customers other companies or are you targeting consumers? What do your customers want and why do they want it? These are just some of the questions you should try to answer before launching your customer loyalty program. Keep in mind that retaining a customer is far easier and cheaper than trying to attract new customers. This is one of several reasons why customer clubs and loyalty programs are popular in all industries.
A program for rewarding loyalty can also be used internally, that is, towards your own staff. Loyalty programs can reward employees who have worked for a company for a long time or who have performed some type of remarkable achievement. This is equivalent to a motivational program, i.e. a program that aims to inspire staff and increase performance in different ways. The rewards don’t have to be individual but can also be common. An example of a reward is to take the staff on a conference trip.
Whether you want to design a program for consumers, for companies or for your own employees, it’s important to have clear goals. Examples of goals may be to get a certain number of former customers to buy from you again, to sell more to current customers or to reduce staff turnover. As you notice, there are many things to consider when launching a loyalty program. It’s much easier to get help from experts who can analyze your business and your customers. This way you can get a loyalty program that fits your target group and your company perfectly right from the start.