It pays to keep your current clientele happy. And customer loyalty programs can do just that.
For example, in the financial services industry increasing customer retention rates by just 5 percent can boost profits by more than 25 percent, according to research done by Frederick Reichheld of Bain & Company.
In addition, 81 percent of consumers say loyalty programs make them more likely to continue doing business with brands, according to the 2017 Loyalty Report from Bond Brand Loyalty.
What Are Loyalty Programs?
Loyalty programs typically offer benefits to customers who repeatedly engage in some sort of interaction with a brand.
Companies that use these programs offer personalized rewards and recommendations in hopes of building stronger relationships with customers. Loyalty program perks can include free merchandise, coupons, advanced released products and inside details about upcoming products.
This helps build a positive customer experience, boost customer satisfaction and add a bigger value to products or services a company offers. Having a customer-focused loyalty program, like that proposed by Epsilon, can really give the business adopting it an edge over its competitors.
The Best Loyalty Programs
Fortunately, you don’t have to reinvent the wheel to build or implement a great loyalty program. Choosing a POS with a loyalty program can help streamline implementation and get your customers building rewards within days.
So, what makes a great loyalty program? Learn by example and take a page from the book of these brands rated as having some of the best loyalty programs by Bond Brand Loyalty. Companies with highly rated loyalty programs include:
Frequent fliers of Southwest Airlines are likely familiar with the Rapid Rewards program. With this point program, customers earn rewards whenever they fly Southwest, but also earn rewards when they use one of the company’s partners. Points are redeemable for flights, gift cards, merchandise, hotel stays, rental cars and experiences.
There are also additional tiers for those who frequently fly, offering perks like priority boarding, priority check-in and free in-flight Wi-Fi.
Amazon Prime has become such a staple that it’s easy to forget it’s a loyalty program. This membership-based program costs $119 per year and offers benefits such as free two-day shipping. It also offers free same-day shipping in some cities on purchases over $35 when they are made early in the day, typically before noon. One-day shipping is available in some cases when you place orders by afternoon.
Other perks include access to:
- Amazon Restaurants
- Whole Foods discounts
- Prime Photos
- Prime Video
- Music streaming
- Amazon Household
And let’s not forget access to books, the foundation on which Amazon built its business.
Panera Bread is on top of its game in the restaurant brand loyalty category. Members of MyPanera earn rewards points just by showing their membership card every time they make a purchase at a Panera restaurant.
Those rewards include things like complimentary bakery-café items, previews and tastings, and even cooking tips. Special events are also part of the loyalty rewards package.
The program works well because it’s simple for the customer to use — just present the card when making a purchase.
Ideas For Loyalty Programs
As seen with the Panera Bread loyalty program, you don’t have to get fancy to create a great brand loyalty program. With a points rewards system, customers who frequent your establishment earn points. Those points earn customers things like discounts on products, free items, access to special events or some other reward.
According to HubSpot, many companies falter in establishing a clear relationship between points and tangible rewards.
So don’t make it complicated. Try a one-to-one ratio — one point equals one dollar. Then, decide on your rewards. When using a POS system like Talus Pay, customers will easily be able to watch their points accumulate and see how close they are to a reward.
Word-of-mouth is still one of the most powerful marketing tactics around, and that’s why the refer-a-friend loyalty program strategy can be a powerhouse.
Customers refer a friend to your business and earn some sort of reward for doing so.
For instance, in some cities, Lyft drivers get a $10 bonus for referring passengers. Drivers get a unique link they can post on their social media channels. When someone clicks the link, they are guided through the Lyft sign-up process and the driver is credited with $10.
Sometimes it pays to charge an upfront fee for loyalty rewards. In this type of model, customers get perks and are able to avoid inconveniences that might cause them to abandon a purchase.
According to HubSpot, “By identifying the factors that may cause customers to leave, you can customize a fee-based loyalty program to address those specific obstacles.”
Amazon is a perfect example of a membership-based loyalty program. As we mentioned earlier, it charges $119 per year for a number of perks, including free two-day shipping.
Costco is another great example. There, members are required to shop at Costco stores to get access to exclusive deals on bulk products.
Loyalty programs can help retain and build your customer base. And while the right type of loyalty program depends largely on your business, building a loyalty rewards program doesn’t have to be complicated.
Figure out what your customers want, keep it simple and start offering exclusive perks to your returning clientele.
For more information about implementing a customer loyalty program, Contact us today to discuss how Talus Pay can help your business.