LOYALTY PROGRAMS THAT GO BEYOND REWARDS. How to understand your customers and keep them coming back

Transcription

1 LOYALTY PROGRAMS THAT GO BEYOND REWARDS How to understand your customers and keep them coming back

2 TABLE OF CONTENTS 1. WELCOME TO THE WORLD OF LOYALTY PROGRAMS A BIT OF HISTORY LOYALTY PROGRAM - IS IT FOR YOU? WHAT CAN A LOYALTY PROGRAM DO FOR YOUR BUSINESS? WHAT CAN YOU OFFER YOUR CUSTOMERS? CAN SOFTWARE HELP YOU APPROACH LOYAL CUSTOMERS? WIFI - POSSIBLY THE EASIEST AND CHEAPEST TOOL TO USE

3 WELCOME TO THE WORLD OF LOYALTY PROGRAMS Everyday, consumers are surrounded by the marketing efforts of a wide variety of brands, finding themselves in a world of choices and options. Brands intend to influence their decision-making with packaging, pricing and customer service but all consumers are looking for is a stable relationship with brands they rely on and trust. It is human nature to stay with a company that offers the most effortless and efficient way to do business. Ignoring the call for a good relationship, many enterprises focus their marketing efforts on attracting new customers while forgetting about their existing ones. Acquiring new customer can be 5 to 25x more expensive As a recent study in the Harvard Business Review revealed, acquiring new customers is five to twenty five times more expensive as maintaining existing customers. So, why don t you channel your efforts into your existing customers, who cost less to maintain and generate more profit for your business? 3

4 A BIT OF HISTORY Looking back, Loyalty Programs have come a long way. lt probably all started with the small bakery around the corner. The bakery owner would know every single customer and he also knew what each customer was going to get on which day. All this was made possible by the little notepad on the counter of the baker. Here the baker would jot down the names and shopping habits of his customers. Consulting his trusty notepad (the first app?), the baker could then highlight specials for his most loyal customers. Since then, Loyalty Programs, have changed profoundly. Today, we are looking at sophisticated programs, using software and employing different currency systems to reward customers appropriately. One of the most successful programs might be the scheme that Starbucks implemented. It offers a customer card and a mobile app for Starbucks lovers that will allow them to collect stars and be ranked, depending on their level of dedication to the brand (and how much money they spend, obviously). Depending on what level the customers find themselves at, they can win rewards, such as free syrup or whipped cream as topping for the drinks. Starbucks and Tesco are two companies with successful loyalty programs. Another successful scheme is Tesco s Clubcard. It offers discounts to customers that use the card in form of vouchers. In other words, people are rewarded for shopping by offering them a discount on their next purchase, which makes them return frequently and converts them into loyal customers. This scheme also entails an app, online accounts and Tesco s databank full of information about their clients shopping behaviour and spending patterns. 4

5 LOYALTY PROGRAM - IS IT FOR YOU? This probably won t surprise you, but the number of customers your business can serve is finite. Your business can t reach out to each and every consumer in the world, it is simply not feasible. Many companies can find themselves tangled up in acquiring new leads and customers instead of focusing on the ones they already have. These should be the customers to focus special efforts on. By approaching them with a Loyalty Program, you can convert them into loyal customers that will stay with you long term and generate way more revenue for you than potential new customers. Returning customers are the ones that really help your business to stay profitable, as they spend 67% more than new customers. 5

6 WHAT CAN A LOYALTY PROGRAM DO FOR YOUR BUSINESS? As you might have guessed already, Loyalty Programs are mainly used to increase returning customers, but this is not the only thing your company can get out of a well-thoughtout program. Providing additional rewards and showing initiative will demonstrate to customers that you care about them and reinforce your relationship - such an approach will help move customers up the buying ladder and convert first-time buyers into repeat buyers. customers, your Loyalty Program can also be used to attract new customers. It s no secret, word of mouth advertising is by far the most powerful form of endorsement a business could aim for. In fact, a Nielsen survey revealed that, 92% of consumers trust recommendations from friends and family. A very important thing that happy customers do for you, without them really noticing, is boost your reputation. Customers who feel appreciated by your company are more likely to talk about and recommend you to people around them. With such a strong endorsement by existing 6

7 ...WHAT CAN A LOYALTY PROGRAM DO FOR YOUR BUSINESS? Another effect of a Loyalty Program is that you respond to your competitors. Once you manage to increase the loyalty of your customers, it will be a lot more difficult for competitors to peel away the customers from your brand. Additionally, a Loyalty Scheme provides you with a large volume of customer information points, such as age, household size, address and gender, which can be taken and stored in your customer database, and ready to be used in an instant. Furthermore, data keeps being collected during every single shopping trip. Retailers can get insight into the shopping behaviour and see what the customers add to their basket. A profile of the shopping behaviour can be created over time, including how much the customer buys and the preferred method of payment. A good example of this type of ongoing collection of customer data is Tesco. During checkout, customers are asked to present their Clubcard, which enables Tesco to track exactly what the shopper is buying, how much is bought and how the customer prefers to pay. The collected data enables Tesco to promote goods and send personalised offers that the customer is most likely to buy. 7

8 WHAT CAN YOU OFFER YOUR CUSTOMERS? 54% of consumers would switch brands for a better price, whereas only 8% would switch for a better selection. With consumers, price is king. So, why not use your Loyalty Program and reward your customers with lower prices or free giveaways? Scientists agree, free stuff is always good, and more free stuff is even better, according to the Nielsen Global Survey of Loyalty Sentiment, bigger rewards generally entail higher loyalty levels. When it comes to the rewards you can offer your customers, the possibilities are endless and can be catered to the strengths of your business. Larger business owners might find a points based reward system to be the right choice, while a business owner just starting out might opt for cash discounts on goods. The choice is up to you. 8

9 CAN SOFTWARE HELP YOU APPROACH LOYAL CUSTOMERS? Getting to the real needs and wants of the consumers is what really matters, after all. What most consumers want is feeling like they ve got a good deal. In order to collect information on customers, software of all types is employed today. The data held in these programs enables business owners to approach customers on a personal level with a customised offering. Loyalty Software packages typically offer rewards management, CRM, a member portal and even mobile loyalty apps. On the consumer side, customer cards and apps are the main tools that are used to collect loyalty points. All this automation is great, but what if there was an even easier and cheaper way to help secure customer loyalty? 9

10 WIFI - POSSIBLY THE EASIEST AND CHEAPEST TOOL TO USE Nowadays, Guest WiFi is a must-have. Customers rely on working WiFi and expect venues to offer them a stable connection as soon as they put their foot in the door. Being online has never been as important as today. Software for managing Guest WiFi, like BLACKBX, can help you increase customer retention by collecting customer information over WiFi. What kind of data? Well, the possibilities are almost limitless - you can capture data like age, gender, address or phone number. Armed with these insights, you can then approach your customers on a personal level, which is key to increasing loyalty. Marketing automation is another fundamental tool to add to your customer loyalty strategy. With marketing automation, you can create campaigns that are triggered by the behaviour of your customers. For example you could send out SMS/ to a user whose birthday is coming up, or welcome new users with an SMS including an unrefusable offer, or reward loyal customers when they reach a certain amount of time spent on your network or the numbers of time they visit. Not trying to pat ourselves on the back too much, but BLACKBX does exactly that, and it is very easy to set-up. Software, such as BLACKBX, can also help you to reward your loyal customers by tracking the frequency of their visits at your venue and keep in touch with them even after they ve gone home. 10

11 SO WHAT WILL BE YOUR NEXT STEP? In this ebook we hope you learned a bit more about: The importance of a Loyalty Program How Software can help you implement a Loyalty Program How to benefit from a Loyalty Program How BLACKBX can help you set up a program by using WiFi What you can offer loyal customers If you d like to add that extra tool to your loyalty program/strategy, contact us at enquiries@aspensolutions.co.uk or

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