Do repeat customers matter for small and medium-sized businesses (SMBs)? Can small companies afford a customer loyalty program? You have reached this blog for answers to these and related questions. Studies suggest that only around 34 percent of small businesses have loyalty programs. Therefore, there’s a massive space for such initiatives.
Does rewarding consumers for their burying behavior prove beneficial for businesses?
Yes indeed. Companies report the following advantages after introducing loyalty programs:
- Drastic improvement in customer retention percentage
- Improvement in customer lifetime value
- Increase in repeat business
- Improvement in customer relationship and satisfaction percentage
- An upper hand in product or service comparison with competitors
- Increase in revenue
Here’re ways SMBs can make their loyalty programs stand apart and subsequently turn consumers loyal.
1. Know your audience
What works for Starbucks and Amazon may not work for you. Your consumer base is unique.
Your loyalty program will become a success story if you give customers what they want. What’s the solution? Well, conducting a market study and analyzing the needs of loyal customers is crucial.
You certainly want shoppers to return again and again, don’t you?
Work with market research firms. Conduct studies, interviews, surveys to understand your customer base. Analyze customer service data to get insights about your consumers. Once you know your shoppers, you can choose rewards that meet their requirements.
2. Use apps to deliver a unique and effortless experience
Loyalty programs can achieve tremendous success if they are accessible via mobile devices.
Customers won’t join the initiative if the program fails to offer a seamless experience. And this is where apps come into the picture.
Why not deliver gifts, personalized deals, and rewards notifications to consumers’ phones? With loyalty apps, shoppers can check rewards, discount coupons on a real-time basis.
Offer treats to every shopper on their birthday. Establish an emotional connection with them.
3. Make the rewards worth it
Some brands find it challenging to sign up new members for their loyalty programs. No wonder. Why will customers sign up if rewards are lackluster? Why would they sign up and wait for several months to accumulate points and claim the bonus?
Shoppers want incentives worth their time and attention. Give them something they cannot buy anywhere.
Most brands have $200, $500 as thresholds for rewards. It’s logical. No business can afford to offer a free product on every bill in the post-COVID-19 world. However, it’s best to low thresholds for ensuring customers keep coming back for more.
A tiered rewards structure can work best for loyalty programs these days. Let high spenders reach the last tier and earn intangibles. On the other side, let consumers getting first and the second tier enjoy a free cup of health drinks, health checks up, or Covid-19 vaccine booster shots.
4. Customer service should be the top priority
Your loyalty program success relies on your customer service. So, ensure you have enough staffing for handling incoming queries.
A study published by HubSpot highlights consumer expectations around social media interactions. Roughly 79 percent of users expect brands to respond to their social media posts within 24 hours. Out of these, 39 percent want businesses to revert within 60 minutes.
Customer service influences the consumer’s choice of brand. Today, consumers use social media interactions to judge if brands value their shoppers.
Customer service can improve brand loyalty. Therefore, your service team should have the authority and resources to solve issues. They should file complaints and offer resolution quickly.
Do you need ample time to solve the problem? Let the service team keep the customer in the loop. Your consumers will tolerate delays in resolving issues. Just keep them informed about how their complaint is being handled.
5. Promote in-store sign-ups
In some cases, customers may not wish to download an app for one store or business.
Firms can use in-store tablet PCs to let customers log in, check rewards and redeem points. Devices like an iPad can attract shoppers’ attention. It can improve sign-ups as well as participation in the loyalty program. This has worked well for several restaurants and coffee shops in the past.
Similarly, you can integrate digital loyalty software with your company website. Let your shoppers log in to their accounts to track loyalty points and redeem the same.
6. Invest in becoming a part of customer lifestyle
Local businesses cater to a small pool of shoppers. Sponsoring community events or hosting sessions with influencers can attract an audience. Offer access to these events as a part of your loyalty programs.
Show your customers that you intend to be a part of the community lifestyle. Build a relationship that goes beyond the purchase point.
7. Teaming up with other small businesses for loyalty programs
Several small firms do not compete with one another. Yet, they share the same target market.
Are you confused? Here are two simple examples.
Customers visiting a local home furnishings firm might wish to buy a mattress. So, if you are selling a bed, partnering with a nearby home decor business for loyalty can work. If you own a bakery, joining hands with a nearby cafe can enable you to offer group deals.
How can a loyalty program partnership between two firms prove beneficial? Such initiative can enable the loyal consumer base of one business to buy from another. It can prove a win-win for both.
Businesses can offer a variety of incentives. They can make loyalty programs more appealing to consumers.
Here’s a look at the most appreciated loyalty program models:
- Free perks
- Refer a friend
- Subscription programs
To sum it up:
Are you unsure if your firm can afford to run loyalty programs? If restaurants and coffee shops can run loyalty programs, so can any small business. It will help if you consider working with a reputed loyalty programs agency. Let experts design a loyalty platform and retention strategies for your business. You can quickly launch a loyalty program with Plug & Play or SaaS solutions.
About the Author:
Rakshit Hirapara is a professional content marketer at LoyaltyXpert. He holds spectacular skills in loyalty programs, customer retention, loyalty marketing, digital marketing and many more. He has been featured on major publications like Hyken, User com, Martech and a few more.