The benefits of a customer loyalty program in Perth
In today’s competitive environment all businesses are looking for ways they can not only attract customers, but also retain the customer base they have. It is far easier and cheaper to sell to customers you already have than it is to attract new ones, and customers are always being approached by competitors with offers to lure them away from you. So how can you improve your customer loyalty? Why not consider a customer loyalty program for your customers?
A customer loyalty program is surprisingly simple to implement, especially online, and can bring many benefits to your business and your customers. Here are five ways your business can profit from starting a loyalty scheme.
Customer retention
The most obvious benefit of a customer loyalty program is that it improves customer retention. Customers will want to accumulate points to enjoy the rewards or benefits on offer, and will stay rather than be tempted by a competitor.
As retention improves, so does the long term value of your customers. This takes into account the value of a customer from the first time they purchased from you instead of focusing on their current worth. By retaining customers, your business can generate maximum revenue over a longer period and optimise your return on marketing investments.
Customer data
A customer loyalty program allows you to collect additional data about your target audience. Most individuals are willing to share a little extra information in return for loyalty rewards, and you can use this to improve your understanding of your customer base.
The extra information helps group your customers into different categories so as to better target them with marketing campaigns. Your customer loyalty program thus turns full circle: your customers give you information in return for rewards, and you give them what they want with better marketing and the products they love which, in turn, improves customer retention!
Business planning
Once you have implemented a customer loyalty program and gathered extra data about your customers, you can use this information to better plan your business strategies. Whether the information is in terms of money spent, demographics or buying behaviours, it will help you plan your business decisions based on solid data instead of guesswork.
For example, suppose you are thinking of starting a new product line. Your market research will provide details of your target demographic by age, gender, location, income and other factors. Comparing this information with that gathered from your loyalty program will show you whether you are on target or need to reconsider .
Increased customer purchases
Generally, customer loyalty programs encourage customers to spend more to earn more points. You can extend this by running limited time promotions, offering extra points on specific products (usually the ones you want to clear from stock) or services, or even creating ‘treasure hunts’ for promotional codes hidden throughout your website. The possibilities are only limited by your imagination and your website developer’s ability!
Combining your customer loyalty program with marketing campaigns can also generate extra purchases. For example, you could run a simple ad that offers extra loyalty points for signing up and bonus points for spending more than a given amount on their first visit (subject to certain terms and conditions).
Competitive advantage
In a competitive global market, you need to make the most of every possible advantage to beat the competition. Having a customer loyalty program hands you just such an advantage. To put it simply, the more creative you are with your loyalty program, the further ahead of your competition you will be.
These are just a few of the benefits a loyalty program can offer your business. Remember to make sure the program is attractive to your target audience so that, once it is up and running, it will gain momentum with every new registration and every promotion you run.
Comments are now closed for this article.