Loyalty programs have proven to be one of the most effective ways to increase revenue and inspire customer loyalty; research shows that 90% of companies have some kind of customer loyalty program. While there’s no doubt that the traditional methods of points, social media programs, etc. are effective, some companies are looking at ways to find innovative new ways to build loyalty programs and inspire customer loyalty.
Continue reading for some examples of innovative customer loyalty programs and how you can start your own.
Supermarkets
Multiple supermarkets have a customer loyalty program, including Sainsbury’s Nectar Card, Tesco Clubcard, and now ASDA, too. Another popular retailer with an effective loyalty strategy is Boots, with their iconic Advantage Card.
Starbucks
Another example of an innovative customer loyalty program is Starbucks Rewards. The basis of this system is very simple. In order to earn loyalty points, customers must order or pay with the Starbucks app. This method of centralising customer transactions creates a wealth of data on customer behaviour and preferences for companies, too.
If a loyalty app is feasible for your own store, it can be a great way to collect and centralise customer data.
Designer Shoe Warehouse
DSW run a VIP customer loyalty program that rewards customers with points for each purchase and it also includes tiers of rewards that customers can unlock as they spend more.
There’s always a danger when rewards become automatic that customers forget about them and aren’t enticed to spend more. DSW recognised this and in 2017 they launched an email campaign to remind customers about their program, telling them what deals they were currently eligible for.
How to start your own customer loyalty program
1. What will you offer?
The first step is deciding what reward you want to offer and what for. Research shows that 57% of customers sign up for a program to save money, so you might want to consider using ongoing rewards that cut customers’ costs.
Cashback often works well for the same reason that gift cards are so popular. This reward has an especially big appeal because customers can get whatever they want with this type of reward.
2. Make it easy
The best loyalty programs are easy to join because if it’s confusing or time-consuming, most customers will give up.
Loyalty rewards that have a clear structure and no hidden exceptions are the best because it minimises confusion and maximises trust.
3. Automation
Most importantly, make sure the program is able to run itself without much management. It’s likely you don’t have the time to analyse the report data you plan to collect, so ensure the program will essentially run itself and produce results without creating a burden.
4. Put customers first
Ensure your program benefits your customers before anything else. Increasingly, companies are using loyalty programs that are data mining, something that customers are likely to frown upon. Loyalty programs like these may decrease customers’ trust in you.
Loyalty programs are one of the most effective ways of engaging customers and spreading word about your business. They can also be used to build partnerships that will further enhance the effectiveness of your loyalty program.
