customerloyaltycardAmerican Express performed a survey, where results discovered “seven in ten Americans (70%) are willing to spend an average of 13% more with companies they believe provide excellent customer service.” Many companies use Customer Loyalty Programs as a way to cater to their best customers, and to offer new customers a reason to come back.
Customer Loyalty Programs have become a popular way to frequently, instantly and conveniently reward your customers. Programs in all types of formats exist—we are all a member of one or another—from coffee house punch cards to frequent flyer miles. Increasing your customers’ loyalty will yield your company profit over time, will create a following of fans who turn into brand advocates, and will be less expensive than starting a new customer acquisition program.
If you’ve already implemented a Customer Loyalty Program…
…what can you do to boost performance? Here are a few progressive ideas:
- Have you heard of “artificial advancement?” Two consumer researchers conducted a customer loyalty experiment at a local car wash, giving half of the 300 loyalty card-holders an 8-punch card, and the other half a 10-punch card with 2 head-start punches (same concept with an artificial advancement: 8 washes = free wash). The head-start card-holders had a 34% success rate! Long story short? Offer your customers endowed progress when they join, or during special times of the week or month.
- What other options can you provide a customer, other than discounts, points, or free products after purchases? Patagonia, an environmentally-friendly outdoor clothing company, started the Common Threads Initiative, where their current customers can resell their gently used Patagonia gear online through the company website (powered by an eBay engine). Not only do customers have an easy way to resell their unused apparel, but they are assisting in the company’s initiative to decrease their carbon footprint. This type of loyalty program is deeply engaged into the customer experience versus just giving your customer rewards for staying loyal.
- Punchh, a California based software company, invented a virtual punch card that brings that ‘old school’ notion into the technology age, where customers who download a Punchh app from participating vendors receive virtual card punches for bringing referrals in to the vendor, and for posting reviews on social media networks. And of course customers receive “punchhes” for repeat business.
What do all of these examples tell us?
In short, that there are many ways to dream up innovative Customer Loyalty Programs. In simple terms, focus on the following while creating and implementing your Customer Loyalty Program:
- Consider the customer’s experience, not just their purchase
- Offer different ways for your customers to be loyal – punch cards may be still be in use, but so are mobile apps, for example
- Remember the KISS method: Keep it Short & Simple (sure, there may be another acronym for this but for today’s blog we’ll use this one)… Loyalty programs that are easy to follow and use are better for consumers.
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