One of the biggest challenges facing small business owners today is not only attracting customers, but also retaining them. Today, many companies are looking for ways to increase foot traffic and business engagement.
Businesses have become aware that 70 percent of customers do not return to shop again. This is why a digital loyalty program is needed to keep them coming back and engaging with your company.
Businesses including restaurants, salons and spas, grocery stores, coffee shops, retail stores, health and fitness centres will find digital loyalty cards beneficial. If you want to know how to increase your customer value, scale your revenue smarter and faster, then read on!
Want to learn more about how a digital loyalty card can improve you business? Checkout our other guides.
Basics of Loyalty Cards
The best use of a loyalty card is one that stores customer data and offers a rewards system of discounts and points. The aim is to motivate customers to return to your business again and again.
Loyal customers are more likely to look at new products and even spend more. A consistent profit in business depends on the number of customers you retain and the extent of your relationship with them.
A survey conducted by invespc shows that an increase in customer loyalty of only 5 percent increases profits by up to 90 percent! Converging evidence has shown that consumer buying habits change over time, and it is important for companies to track these habits so that they understand what their customers actually want before marketing to them.
Gathering Important Consumer Data and Purchasing Trends
There is no better way to collect consumer data and buying trends than with a digital loyalty program. Customer demographics, interests, location, and current purchasing behaviour enable you to better engage with them.
This consumer data is useful for proper consumer segmentation, which could be useful for personalised marketing. It helps you to know how to serve your customers better - you give them exactly what they want, not what you imagine they want.
Improve Consumer Communication and Engagement
One way to use a reward system effectively is through surveys. Never assume you are offering your customers the best form of customer service. A reward system allows you to collect first-hand data directly from your customers to determine whether they are satisfied with your service and know how best to serve them.
In addition, you could easily use this data to assess your competitive position in your niche and know how to serve your customers better than your competitors.
For example, you could conduct a survey by sending messages / e-mails to your customers, asking them to quickly fill out a survey. The success of this survey depends on how well you promote it through relevant rewards. Here is an example of a perfect message to encourage participation in a survey.
" As a way to serve you better, you’ve been selected to participate in a brief survey concerning our **name your product**. This is your opportunity to take an active role in helping shape the future of **name your brand**. As a thank you for participating in this survey, you have an opportunity to win any of the following prizes **name different prizes** "
Create Personalised Experience for your Customers through Tailored Rewards
If you have not yet implemented a digital loyalty program in your business strategy, you may be doing yourself a disservice. Digital loyalty schemes automatically track customer data and store their purchase history.
Today, nearly 70 percent of customers prefer to shop at companies where they earn rewards. Companies that integrate a digital loyalty program into their marketing strategy will definitely have an advantage over their competitors.
Starbucks is one of the world's best-known coffee brands that uses a digital loyalty platform to increase customer engagement. Starbucks rewards customers in several ways, including birthday bonuses, prepayment options, purchases to earn free drinks and food.
Their loyalty platform uses stars for rewards, and there are several ways to get more stars. If you're registered on the Starbucks loyalty platform, you'll get a chance to win two stars for every $1 spent. With 25 stars you are already qualified to unlock a reward. Starbucks' digital reward program has generated more than 16 million active users of the app.
Well, your business doesn't have to be as big as Starbucks before you can use a digital loyalty program. Regardless of your business type and size, you can take a Starbucks approach to your business.
For example, if you own a restaurant, you could set up a reward program that allows your loyal customers to win free drinks, some treats, or even a meal depending on their points. If you're a fitness trainer, you might also find a way to get your loyal customers to earn points and reward them with free sessions.
Promotes Higher Value
It is a win-win when customers get rewarded for their loyalty. The key to winning customers is through personalisation, incentives and rewards. If customers know they would definitely get more than what they pay for shopping with you or your service then they’d keep coming back.
It is left to you to figure out how to configure your point-based rewards. It could be based on frequency of visits to your business, purchasing habits or value of purchase. It is also possible to combine these methods so that everyone benefits from your loyalty programs.
Gives you Details of your Top Customers
About 80 percent of your sales come from 20 percent of your customers. These are the customers you can't afford to lose. Hence the need to get their data.
Additionally, a strategic deployment of a digital loyalty program will make casual customers regular customers. Regardless of the company you run, you need to find a strategy to drive repeat purchases through digital loyalty programs.
A strategy to drive repeat purchases is to integrate your loyalty program with email marketing automation and social media. The data collected through the loyalty program can then be analysed, and e-mail marketing sequences can be automated to drive engagement and ultimately give occasional customers a sense of "partnership" with your company.
Summary
- People are more likely to do business with you if your business has a digital loyalty scheme.
- A digital loyalty program enables you to create a personalised experience and collect consumer data from buying habits, history and the lifetime value of your customers.
- Data from digital loyalty programs can be used to send personalized offers, discounts and coupons. It also enables you to market to your customers from their interests and purchase history.
- Existing customers account for more than 70 percent of your sales.
- Existing customers are more likely to consider your new products.
- It costs more to acquire new customers than to keep them.