You and probably everyone else you know are part of a customer loyalty program. Just look at your key ring, or in your wallet, and you’ll probably find a bunch of cards for a variety of businesses. It is estimated that at least 75% of consumers have at least a single loyalty card, and that those with more than two comprise a third of the population. Loyalty programs have been around for decades, and many businesses have some form of simple strategy, if not a more elaborate one.
While you may fear that a loyalty program is too expensive or complicated, there are a host of really simply strategies that can have just as much impact for a fraction of the financial investment.
With this in mind, you need to make sure that your program is structured around your customer and what they believe is valuable. Otherwise, the reward or incentive won’t be enough to motivate your client to return.
Keep in mind that customer loyalty programs also allow you to track and monitor your customer’s purchasing habits, and even gain further demographic information through a detailed sign-up form. Your loyalty program could serve as a vital component of your ongoing marketing research.
I want to note that customer loyalty programs don’t work for every business – to imply so would be misleading. If you sell high priced items, chances are that customer isn’t going to be coming back to buy from you every month. In that case, you may be better served by an incentive-based referral strategy to gain more business from your customer’s friends and family network. This will still maximize your customer acquisition investment.