Loyalty programmes are a well-established part of customer life. A study undertaken by YouGov and Mando-Connect has shown that 77% of us are members at least one programme—and that younger people are more likely to join one. That means loyalty programmes not only offer plenty of sustained business opportunities—but, more importantly, they’re here to stay.
So why are they so effective, and so well-received?
Why A Loyalty Programme Benefits Customers
People Like Discounts and Offers
At this point, it is human nature to save our pennies and search for deals, even when we’re not necessarily thinking about buying yet. Customers have many reasons to be careful with our money, and we want to be sure that it is being used properly. A loyalty programmes is therefore an investment—it means your brand has passed the test on whether your customer thinks you’ll benefit them over a longer period of time.
For some consumers, brands can come under part of their identity, whether that’s their clothes, their food, or the services they elect to use. (Ask any iPhone user what they think of Android, and vice versa!)
This isn’t a driving force for a lot of customers—6% of respondents in the survey said it was important to them—for a niche demographic that may be a serious consideration. Therefore, if your business relies on a niche group of consumers, it may be a serious benefit for you to cultivate a community around your brand. Once established, your consumers will be much less likely to jump ship.
Rewards for Feedback
Long-standing relationships between companies and customers are, at heart, symbiotic: both of you can offer a benefit to the other. That doesn’t always mean money for the company; there are other aspects to business, such as feedback, that are integral to keeping the business alive. Getting regular and insightful feedback can only really come from customers whose experiences are consistent and long-term. They can be part of the reason why your company grows and reaches new heights. For their efforts, they can receive rewards—again, not always money, but a show of appreciation such as a free offer.
Always an Appetite for More
59% of respondents to the YouGov/Mando-Connect survey said that all brands should offer a loyalty programme. If there’s an appetite already there, you can make an informed guess as to how successful your loyalty programme will be. There will always be someone interested, and ready to reap the benefits of your mutual loyalty.
So, the consumer is ready for a loyalty programme. This is always good to hear—but what about business?
Why A Loyalty Programme Benefits You
Solidify Customer Retention
Loyalty programmes are one of the best forms of customer retention a business can adopt. Not only is there a huge appetite for them, but their inherently rewarding nature means customers are encouraged both to stay and to spend. Loyalty programmes are a large part of the reason why you can increase your profits by 25-95% for every 5% increase of customer retention.
Increase Brand Advocacy
Businesses live and die by the good—or bad—word of their customers. Bad reviews can tank sales, but recommendations (especially word of mouth suggestions) keep your growth going. Giving your customers something to shout about can only help your brand, and bolster your reputation amongst your competition.
Feedback is an important part of a company’s growth, as improvements pave the way for more sales. As no one knows your brand better than the customers who stick with it, the opportunity to hear what works and what doesn’t gets magnified significantly. You can keep on growing, knowing you’re doing right by your customers—with the sales to prove it.
This will become even more important for businesses who rely on cookies for marketing, as we see the decline of cookies on websites. Therefore, as mentioned above, focusing on consumers you already know are a good fit for your company will increase the likelihood of sale—by 60-70%, in fact. You’ll be spending less on broad, unspecific advertising, and generating more sales for your marketing budget.
Managing Loyalty Programme Members in a CRM
Your CRM is a great place to keep track of all your customers and monitor your relationship to your business. In popcorn, the tagging feature allows you to easily sort and segment your contacts into campaigns in seconds. That means keeping an eye on your loyalty programme members only requires a few clicks of a button. Then, all the necessary information is there before your eyes.
You can control your loyalty programme members by using the automation to tag or move a contact into a separate pipeline section when necessary. This can be a completed Call-to-Action or through popcorn's website tracking. This way, you can spot potential candidates and send them an email inviting them to the programme.
Email campaigns can also be controlled from start to finish in popcorn; from the creation of the email to its automation.
If you'd like to find out more about popcorn, you can read our features here.
Loyalty programmes aren’t a one-size-fits all. But the benefits of loyalty programmes prove overwhelmingly that this technique is well worth the effort—not just for your customers, but for you too.
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