Customer rewards programs provide benefits to your loyal customers, and they can be an essential tool for securing repeat business. Setting up a rewards program is relatively simple, and the benefits to your business can be profound.
1. Customer Retention
A loyal group of customers who patronize your business regularly can be essential to your success. These clients help to keep cash flowing steadily, and create a buzz around your company by recommending it to their friends or using your products. A customer rewards program reaches out to this core group of people and convinces it to buy your products or services more often. Additionally, rewards programs help to convince first-time shoppers to return for a second visit and hopefully many more after that. Ideally, you want to retain as many of your first-time shoppers as possible; attracting a new customer can be seven times more expensive than keeping a customer who has already walked in the door.
2. Boosted Value
Marketing execs estimate that loyalty programs can increase the lifetime value of your customers by 30% or more. These programs accomplish this feat by increasing visits to your shop or website and boosting spending per transaction. However, rewards programs also help to draw in customers who haven’t used your services for a while. For example, if clients haven’t shopped at your company for a set amount of time, you can send them a value-loaded offer to entice them to return.
3. Data Potential
Rewards programs give you a lot of information about your clients and their behavior. For instance, when you are tracking the purchases customers make, you can see which items tend to be purchased together or sequentially. Additionally, if you have the addresses of your customers, you can also identify trends such as which products tend to be more popular for people living in certain areas. The data gathered by your rewards program can be analyzed in multiple ways to further drive customer engagement, and there are tools and professional consultants to help you harness and analyze this data usefully.
4. Targeted Marketing Opportunities
With a customer loyalty program, you can target your marketing efforts. Instead of sending your entire mailing list the same offer, you can send customers offers related to their purchase history. Additionally, if you create a tiered loyalty program, you can offer special rewards to clients who spend more or shop more frequently.
5. Easy Set Up
There are numerous ways to set up a customer loyalty program. The simplest, most basic option is to use the paper-based method. For example, give customers a stamp for each purchase, and when they accrue a certain number of stamps, they receive a free item. Alternatively, you can automate the process using a program such as Hike POS. This application integrates payment processing, loyalty programs, and e-commerce tools into a single platform.