August 16, 2013

Loyalty Programs: Make Them Feel Special


Hostway Team


We all enjoy feeling valued. A personalized note of gratitude, a special offer just for you… such simple acts go a long way toward customer satisfaction and retention. And no one markets as effectively as a loyal customer who can explain why she or he clings to your brand.

Though loyalty programs run much deeper than rewards cards, some tactics are always in style. But the details of your program have to be just right: Is your incentive worthwhile? Is achieving the objective simple, or is there too much jumping through hoops?

Your goals will shape your loyalty program from its inception. Are you simply courting business? Collecting email addresses for a mailing list? Driving website traffic? Trying to keep established customers? Each of these objectives corresponds to a different loyalty tactic.

The success of loyalty programs based around amassing points to reach a goal rides on several components of the promotion:

  • The reward should be something valuable to most customers, not a niche product.
  • The reward item should come from your own inventory, to ensure expenses are controlled.
  • Higher numbers of inexpensive steps often work better than few iterations of expensive steps.
  • Work in a secondary reward component for bringing others into the program.
  • A tiered reward program –silver, gold, platinum, for example – plays on customers’ vanity, and can offer different levels of rewards for people with varied incomes.

Trying to carry customers to your online home, or to that new mobile app you’ve invested heavily in creating?

  • Online-only and mobile only discounts and offers are a great way to get people to check out your various platforms, and their use is alienating fewer and fewer customers as technology continues to take hold.
  • However, any such program must still be easily accessible, easy to complete without major technological hurdles. No real computer expertise should be necessary to jump through the hoops to reach your deal.

Building a database of customer contacts?

  • Create a series of email-only promotions to send to customers whose emails you’ve already acquired, however small that list may be.
  • The emails themselves should have links to special deals at the bottom, so customers have to at least scan through the rest of the document to get to the link.
  • Track the emails for analytics value: What messages are working? What deals are valued? Who is opening what emails?

Hoping to fend off challenges from other brands?

  • Set a time limit to your rewards plan, to ensure that any product purchased on a regular basis must continually be purchased from you for most buyers to earn the incentive.
  • Consider reward concepts that offer a free item after purchasing that same item repeatedly within the time frame. This in essence offers the incentive of a percentage discount, but only to those who follow through on the entire sequence of purchases in a timely manner.
  • Use an email campaign and receipt notifications to present the loyalty program to existing customers. The email campaign should stress the value you see in return customers as well as the value of the product in the promotion.

Remember, however you try to build loyalty, these programs are only supplemental to the basics of building business relationships: good products, great service, and personal attention.

For further reading on optimizing loyalty programs, check out “The Lowdown on Customer Loyalty Programs: Which Are the Most Effective and Why,” which covers several studies with interesting results.

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