So how exactly can you create the perfect rewards program for your guests? Keep reading for some tips:
Creating Your Loyalty Program
1. Establish your goals. What are your motivations for developing a loyalty program? Is it to improve customer retention? Or to entice past customers to purchase again? Whatever your objective is, be sure to make it concrete and measurable. Use metrics to track your progress—whether it's purchase frequency or average number of orders. If you're simply estimating it, then you can never be sure how effectively your program will perform.
2. Figure out what customers like about your product or service. Figuring out what aspects of your product or service your customers like best will give you an idea about what kind of rewards would appeal to them. For example, Dunkin’ Donuts knows that coffee drives a lot of their sales, so their rewards are usually free beverages instead of desserts.
3. Choose a program type. Customer reward schemes come in different forms. Some examples include:
- Points Program: This is the most common rewards system in the market. Every time your customer makes a purchase, they earn points. These points can be used for things likes discounts, freebies, and more. Outdoor brand The North Face uses this system to grant their customers free travel opportunities in exchange for a certain amount of points.
- Tiered Program: Here, the customer gets “loyalty credits,” which are dependent on how much they spend on your product or service. The more they spend, the higher their tier and rewards are. Banks are known to use this strategy to sell credit cards and encourage spending, with platinum members often getting exclusive deals and special treatment from brand partners.
- Paid Program: In this strategy, customers pay a monthly or annual fee to become a VIP member. Similar to higher-ranked customers in a tiered program, they get access to services, discounts, and exclusive offerings that regular customers don’t. One of the best examples of this is Amazon Prime, where users get to enjoy priority shipping and special prices on their purchases.
- Value-based Program: This structure is less about the material rewards, and more about targeting the customers’ set of values. A pet store, for instance, could partner with an animal welfare organization; and for every purchase a customer makes, the store would donate a certain amount to charity. This is likely to appeal to customers who value the cause, and feel that supporting the brand helps them contribute positively.
Promoting Your Rewards Program
1. Train your employees. Your employees are your program’s most vital promoters. If they don’t make an effort to sign up customers, the program will not survive. Make sure they’re fully equipped to make the pitch by creating scripts to follow—including a list of potential customer inquiries and corresponding responses. You can also incentivize it by offering them bonuses for every customer they get to subscribe.
2. Offer incentives to customers who sign up. It’s no big secret that people like freebies, so one of the best ways to get customers to join is to give them something right away—be it free food or a gift certificate. You could also opt to offer the freebie during their next visit after they’ve signed up.
3. Advertise on the proper channels. Of course, you must actively promote your program, especially online where you get a wider reach. The internet provides a wide variety of platforms to promote your rewards program—from blogs to social media. Maryville University's evaluation of the communications industry outlines the importance of understanding different media strategies, given that every channel has its own specific audience. So depending on who you want to target, it's imperative that you know how to adapt to them. For example, Facebook is easily the digital platform with the most reach since it has the most active users, but it's not the best place to find Millennials and Generation Z. For that, you will want to target their Twitter and Instagram accounts. Play it right, and you could be just one sponsored ad away from a new member.
Feature article for ordyx.com written by Angela Colson