In today’s competitive business world, customer retention strategies are everything. But don’t take our word for it: even the Harvard Business Review says it’s less expensive to retain existing customers than it is to go out and find new ones. If a business can find a way to retain customer loyalty, it will gain — and keep — a competitive advantage in the marketplace.
What’s a Rewards Program?
A rewards program incentivizes a customer to behave in a certain way. They motivate customers to come back and make another purchase in order to receive the reward. For example, airlines have frequent flyer miles that consumers can redeem for trips. The incentive is for the customer to stay with one airline in order to add more flier miles.
If your rewards program has tiers, a customer may buy more of your products in order to reach the next level. Airlines often offer Silver, Gold and Platinum status, which allows frequent flyers to board early, and get free drink tickets or other perks.
What Businesses Use Loyalty Rewards Programs
Airlines, hotels, gas stations, grocery stores and even pet food stores all use rewards programs. Business Insider stated loyalty memberships in the U.S. between 2008 and 2012 increased in 10% increments annually, and the average home had 23 loyalty cards per household. Clearly, these businesses are on to something; they know that these programs help retain customer loyalty across industries.
These loyalty rewards programs can also be applied in a B-to-B environment; for example, businesses can be incentivized to buy from certain wholesale suppliers.
Data, Data, Who’s Got the Data
The other benefit of a rewards program is that it allows a business to track the shopping and purchasing behavior of their customers. The analytics lurking behind the scenes of any customer loyalty program capture important data that allows a business to track:
- What kind of promotional offers actually motivate a consumer to buy.
- Seasonal purchasing trends by the individual consumer.
- Brand-specific purchasing patterns.
- Price-specific data.
All of this data allows businesses to personalize the shopping experience for consumers who are hungry for this kind of attention to detail. This personalization will allow you to retain customer loyalty by creating a shopping experience designed especially for that person.
Retain Customer Loyalty – Consider a Rewards Program
Designing a custom incentives program to match the specific goals of your business will take an industry expert with a track record of successfully managing customer relationships across a wide variety of industries. Incentive Solutions wants to be your trusted advisor; we understand what works in a rewards program and what should be left out.
Retaining Customers With Online Incentives
Over the past decade, the Internet has become the most used and relied-on venue of shopping in the world. Customers and businesses alike trust and rely on it more than ever before to conduct business, commerce, social interactions and more. It’s also allowed for the expansion of international transactions so individuals and businesses can buy directly from companies anywhere on the globe. It’s trusted, it’s worldwide, and it’s convenient. It also changed the way we should think about retaining customers.
It’s exactly these features that make it the perfect avenue to use for online incentives and customer loyalty programs. Online incentives and customer loyalty programs are the here, the now, and the future. If someone buys your product, they expect something in return for giving you their business. The Internet gives companies the ability to provide a rewarding loyalty program experience to the customer at the cost of very little hassle to both the customer and the company itself. There’s no paperwork, catalog, or warehouse that you have to worry about when you fulfill your “obligation” to the customer.
And in today’s marketplace, you must have a customer loyalty program in place to add to the value proposition you present to your customers or else they’ll go with your competitors who do.
But don’t just go rush out and throw some hasty online customer loyalty program together. If you put a badly thought out and executed program in place, you can actually turn your target audience off. Consider how much time people spend on incredibly well-done and intuitive websites that aren’t yours. Then consider how off-putting your customer loyalty program site will be if there’s no thought put into its design, the user interface, the rewards and more. They’d back-click in a heartbeat and probably never come back.
These are the types of things that have to be taken into consideration when deciding on the route to take your customer loyalty program in – purpose, design, reward selection, and end game. The results when you think these steps through and design a great program can be staggering. A recent survey by the Aberdeen Group found that companies who implement and stand behind their programs enjoy a 3.4% higher ROI than their peers who do not.
At Incentive Solutions, we’ve been creating these types of programs for more than 20 years. Our online incentive programs are second to none with millions of different reward item choices, which means that every participant you have will find something in the catalog that motivates him or her toward completing your objectives. If you’d like to find out more about our online incentive programs, our customer loyalty programs, and how to start your own, call us today at 1-866-567-7432.
