Repeat business is incredibly important to small business owners. From a cost perspective, it takes more resources to try to attract new customers through marketing and other strategies than to get former customers to give you repeat business. Plus, according to research by SumAll companies with a 40% level of repeat customers generate 47% more revenue!
With so much competition out there, how can you increase customer loyalty and repeat business? One effective way is by establishing a loyalty program. The proof is in the numbers: 3 in 4 companies in the U.S. that offer loyalty programs can boast a return on investment from these initiatives. What’s more, research from KiteWheel found that a quarter of consumers feel frustrated when a company doesn’t recognize their loyalty as a past or current customer.
Despite these realities, when you think of loyalty programs, big businesses probably come to mind, such as airlines and big box retailers. Are loyalty programs viable at a smaller scale for small to mid-sized businesses (SMBs) as well? The answer is a resounding yes. For one thing, a poll conducted by Harris Interactive for Transera revealed that an increasing number of companies are launching loyalty programs — and customer participation in these programs is climbing as well.
And it’s not just the big fish that are swimming in these ponds; smaller enterprises are also getting into the loyalty game. A joint report from Manta and BIA/Kelsey found that 64% of small businesses with an established loyalty program found it effective, earning them more money than the costs of maintaining the initiative.
Creating a loyalty program for your small business doesn’t need to be overwhelming. Here are some steps you can take today to get your loyalty program going without breaking the bank,
Identify your best customers
In the information age, there’s no reason to make loyalty more complicated than it has to be. If you’re a Womply customer, for example, you can identify your 100 top customers with a single click with Womply Customer Directory. From there, it’s easy to see which customers need a nudge to come back to your business. You can also choose apps that allow small businesses to pay a monthly subscription fee for a customizable loyalty program interface.
Customize customer rewards
As the business owner, you get to decide how to structure your loyalty program. Think about ways that customers might earn loyalty points that go beyond just being rewarded for purchases. Other ideas include being gifted points on special holidays like their birthday or Christmas, earning points if they share a marketing message with a friend or their social media network, or simply coming into the store. Your goal should be to balance two things:
- Making the loyalty program worthwhile for your business from an administrative standpoint
- Designing a program that feels fun to your customers and gives them attainable goals
Make loyalty a game
Keeping the fun factor in mind, consider ways to add a competitive spirit to the customer experience while en route to earning loyalty points. Turning the exercise into a game or social challenge can increase engagement. For example, you might post a chalkboard at the front of your store, include a daily update on your website, or send out a daily tweet that showcases customers who are earning the most loyalty points from week to week. Offer a special product reward or discount for the customer who accrues the most loyalty points each month.
Stay engaged in the program
As the business owner, your presence and push can make a big difference in the success of your loyalty program’s adoption. You can distinguish yourself from the pack by continuing to ensure that your company communicates with customers after they join the program, so that they aren’t ignored and forgotten. Most companies fail at this part of the process. One study found that a mind-boggling 85% of customers who signed up for loyalty programs heard nothing at all from the company about their participation after joining the program!
To buck that trend, stay on your customers’ radar screens to let them know you appreciate their loyalty. Keep them abreast of new opportunities to earn loyalty points, and seek their feedback on your program. You can use Womply Customer Feedback as one way for customers to offer you honest, anonymous feedback via text. You can put the feedback number anywhere that customers will see it, from your website to tabletops or near checkout desks. Request a demo to learn more about how to leverage Womply solutions for your business