What is a customer loyalty programme? It is nothing but rewarding your customers who have been loyal to your brand as part of Customer Retention Strategy. A customer is loyal to your brand by purchasing from your online store, following you on social media or subscribing to your email mailing list. Creating a customer loyalty programme allows you to recognize your customers for their loyalty to your store. Whether they’ve purchased from you once or they’re on their hundredth visit, it’s important to appreciate every customer who engages visits or buys from your store. Acquiring a new customer is up to 25 times more expensive than keeping the old ones. Thus, if you build relations with your previous customers you can reduce costs and make more money. Customer loyalty programme can reward customers by offering special discounts that aren’t offered to general public. To make this easier, you can also create a points system where customers receive free items, discounts or special offers. The ultimate goal of the customer loyalty programme is to keep the customers happy to ensure that you retain them as customers so that they continue to buy from your store.
Why you should create a customer loyalty program?
Lower ad spend: If a customer has previously purchased from you, you typically have enough data to market them more affordable. You can retarget them with ads, emails, special promotions or engage with them on social media.
Boosts referrals: Generally, 75% of people would recommend a loyalty programme which they are part of, to their friends. By this, you can easily increase your sales, lower ad spend and built more relationships with a greater pool of customers.
Improve customers: Reward programmes can help boost customer retention by providing perks, discounts and freebies to your one-time customers. This will help lower your business’ churn rate.
Learn more about customers: This loyalty programmes help you understand better how to market to your customers. You can also test your promotions and special offers on your biggest fans to better market. Once you understand what makes certain customers loyal to your brand, you can use those findings to build your brand loyalty.
Build brand loyalty: By creating a loyalty programme, your customers will build their loyalty to your brand. Present them the right offer in a right way, and you could build a relationship with a life long customer.
Increases sales: It’s more affordable to turn a customer into a loyal customer, than to keep finding a new one. You’ll be able to lower your ad spend while increasing your profits by remarketing to customers who are already familiar with your brand.
How to set up a loyalty programme?
Step-1: Decide reward points
Generally in a loyalty programme, you buy something and you will get points for it. When you earn points, you get some sot of reward. But, you can reward your customers for more than just purchases. Obviously you’ll want to reward you customers for making purchases, but you can also reward them for other actions too like,
Social media following
Step-2: Name it!
Give your ecommerce programme and points a name. This step is often underrated, when comes to creating customer loyalty program. Loyalty programs perform better, when they have a unique and identifiable name. if you just call your loyalty points as points, they can seen boring or even worse and worthless. So, try giving your program and currency an interesting name that your shoppers can get excited about.
Step-3: Decide point value
Points are worth money at your store, so be sure you know how much they are worth. The value of your loyalty points is known as redemption value. If you’re going to change up your redemption value from the default, do some research first. It is always advised to keep things the way they are and track your audience behavior
Step-4: How many points to reward?
You have given you points a name, you decided the worth of your points, now all you need to do is assign the number of points that you will reward for different actions. To decide how many points you should reward for an action, you need to decide how much that action is worth to you. When you show them the true value of your points, you’re drastically increasing the odds they’ll return and shop with you again.
Step-5: Explain the ecommerce programme:
Create a page that outlines your loyalty programme including what it’s called, what actions get rewarded, how many points get rewarded, and how many points can be redeemed. If you include it in your navigation menu, it acts as constant remainder to your customers. The more visible you make the programme, the more effective it is. You wouldn’t run a sale without making you customers ware, so don’t do it with your loyalty program.
Customer retention is more important. With a well built loyalty program, you’ll give your customers a great reason to come back again and again. If you have any questions setting up your loyalty programme, feel free to contact us at email@example.com. Libra web solutions transformed around 80 ecommerce ventures for customers from UK, Australia, India, Hong Kong, Singapore since 2008.