First, Build Trust
Then reward customer loyalty
What’s the best way to get new customers? Online ads? Promotions? Cold-calls? Going door-to-door? None of these options. The most effective way to get new customers is using a referral program for your business.
It costs 7 times less to bring a customer back thAn to get a new one.
You can’t buy loyalty.
Over the years loyalty programs have gotten a bad name - many businesses view them as “just giving stuff away” and ultimately hurting their margins. In fact, when done well, loyalty programs do just the opposite. But loyalty programs don’t actually create loyalty - at least not on their own.
Your business needs a solid foundation first; great service and products, delivered consistently to your customers. That foundation builds trust and ensures your customers keep coming back.
A loyalty program is designed to reward your customers for their loyalty, not to create loyalty in the first place.
But Where Do I Start?
What’s the right loyalty program for my business?
There are more ways to structure a loyalty program than we can count, but here are three questions to consider when you’re building one for your business:
Question #1 - What do we want to reward?
Are you basing the program on how much customers spend? What kinds of products they buy? How often they visit? Or maybe a mix of all. Give some thought to what kind of customer behavior you want to incentivize and how you will track it once the program is launched.
Question #2 - What rewards do your customers want?
You can reward customers with store credits or discounts, like spend $100 and get $10 off your next purchase; with free products and services, like buy 10 get 1 free; or even with experiences, like a spa that offers beauty lessons, a sporting goods store that takes their customers on fishing trips or a restaurant that invites loyal customers to cooking lessons hosted by the chef.
Question #3 - How do we fund the program?
Your loyalty program doesn’t have to be funded entirely, or at all, by your business. There are many creative ways to work with your suppliers to get free products and services from them that you can in turn offer as rewards to your own customers. Supplier funded programs save you money and actually help build better partnerships with your suppliers.