Customer loyalty and rewards programs have been around for ages, though their online cousins are a relatively new addition into the mix.
Businesses are always on the lookout for ways to keep loyal customers coming back for more, and increasing the lifetime value of that guest. The good news here is that with few exceptions, a customer loyalty program could be an easy and painless way to do just that for your business. Let’s look at how.
How does an online customer loyalty program work?
An online customer loyalty program replaces all the cards customers would otherwise have to carry around with them in their wallets, purses or keychains, and instead allows customers to give their mobile numbers or email address at checkout who enters it right into the register.
This enters them on to a customer database (totally permission based) and enables the business to send offers and news about their membership. This rewards loyal customers with prizes and discounts for both purchases and interactions.
Why should you do this, and what would be some of the applications?
Beyond the obvious benefit of being able to sign up existing customers to your list, there are a number of ways business owners can benefit with this type of program.
- Announce sales, offer discounts and new products and services.
- Target your customers using the geo-location capabilities of their smartphone, for spur-of-the-moment promotions.
- Consider “gamification” of your loyalty program, as this increases engagement many-fold.
- Accept mobile payments from the same platform.
- And most of all, improve customer retention. According to study by Bain and Co., a mere 5 percent increase in customer retention can result in up to 75 percent more profitability. Is that worth it?!
An example of how well a mobile loyalty program can work!
Jersey Mike’s Subs launched a mobile loyalty program in April 2012 and within one month had signed up more than 200,000 members nationwide! Their loyalty program was allows customers to earn free food and benefit from frequent special offers.
All that is needed from their customers is a mobile number, and Jersey Mike’s can communicate with its customers directly both locally and nationally, thereby targeting campaigns accurately. Mobile loyalty has helped this 56-year-old company find ways to expand their revenue using their current base.
So what about your business?
Implementing an online customer loyalty program can be the deciding factor in whether or not your business finds profitability in these tough economic times. This can be done with a relatively small investment, and utilizing your best existing resource: your current customers!