Loyalty Programs

15 Loyalty Program Best Practices You Must Know

Connor Billing
Min read

15 Loyalty Program Best Practices You Must Know

Loyalty Programs are extremely important to the growth of a business. Having a loyalty program incentives customers to come back which can result in higher profits, improved sales and sustainable growth. Repeat customers are more likely to try new things and refer the business to other people. 

What is a Loyalty Program?

A loyalty program is a marketing strategy that encourages customers to repeatedly shop at their business, usually through an application associated with the program. To optimize these programs, businesses take these steps to generate the most success. 

Establish Clear Objectives of a Loyalty Program

It is important that when beginning a loyalty program that you have a clear idea of what you’re trying to accomplish. Whether it is building trust with your customers or simply increasing sales, you must build around this idea to get the most out of the loyalty program. Once you have that idea you’ll be able to start creating a strategy that can help that idea succeed.  

Personalize Your Loyalty Program

Personalizing your loyalty program gives it an aesthetic and feel that only you can offer your customers. The best part is that this won’t cost you anything since the affiliated marketer is the salesman and not the owner of any product. All you will need other than the program itself would be a website to go along with it. 

Simplicity is Key

The simpler your program is, the better it is for everyone involved. People don't want to use something they don't understand. Today people value their time more than ever, so if your loyalty program is simple enough to be understood quickly, it will be much easier to pull more customers in. 

Use Data Insights to Know Your Customer

The more you know about your customer, the better you can personalize their experience with the program and in your business. There are many different ways that you can collect your customers data including but not limited to:

  • Surveys
  • Transaction history
  • Marketing analytics
  • Customer Orders
  • Web-tracking
  • Social media

Using these simple ways to gain data on your customers will give you an insight on their shopping habits and preferences. 

Create a Unique Loyalty Program That Stands Out

The worst thing you could do is make your loyalty program look and feel exactly like your competitors. You want to differentiate yourself from them and make something that is truly unique. The more unique the program, the more interesting it will seem to customers. It is also more likely that your loyalty program will be mentioned online due to how original it is leading to more customers wanting to join.

Invest in Customer Service

Customer service is an extremely important aspect of any business. The better your customer service, the more customers will want to come back. Providing quality customer service can cultivate a loyal following leading to better reviews and testimonies about your product and services. And none of that is accomplished without having empathy for your customers, understanding their point of view is integral to providing the best service possible. Top-notch customer service can be what separates you from your competitors.

Use a Dynamic Rewards System

When developing a loyalty rewards program it is integral that you keep your customers both motivated and engaged. You want customers to be motivated to keep using your program by having rewards that are worth their while. A great way to keep customers engaged is through gamifying the rewards program. Gamification will turn a program from a great way to get rewards into an exciting and fun way to get rewards. A rewards program will look much more enticing if customers see it as a game that they can enjoy and win.

Keep Your Rules Simple

It is not only important to have a simple program, but a simple set of rules as well. Customers barely ever read the terms and conditions to a program or service that they are signing up for. People often just scroll down and click accept so that they can use the service as quickly as possible. Having complicated rules can turn customers away from the program and even possibly cause complaints, and the less complaints the better. 

Make Your Loyalty Program Flexible

Flexibility is key in any loyalty program, especially when it comes to handling any last minute changes. A flexible loyalty program allows for customers to have more choice in their loyalty and feel more free overall. The more flexibility, the higher the value of the program and engagement by its users. 

Offer Choices

Like previously said, it is better to give customers as many choices as possible. For example, having different tiers for your loyalty program gives customers a multitude of options on how they want to be loyal. Choices of programs and tiers can also attract different clientele. The purpose of this is to have something for all your customers so everyone can show their support and loyalty for the business. 

Communicate with Your Clients

It is always beneficial to keep in constant communication with your clientele. Great ways to do that is through email outreach, promotions, and reward redemption details. Sending emails to customers every once and a while will let them know what they can expect to come in business. Promotions are also important whether it is through competitions or giveaways, because promoting your product or service lets customers know about it. 

Address and Resolve Complaints 

In any business there will be a decent amount of complaints, it is inevitable. What's important is how you deal with those complaints. Address and resolve complaints no matter how big or small. It may seem like small complaints aren't important, but multiple small complaints can crucially affect your business. If you ignore them, that shows the customers that you don't value them enough to resolve their problem, resulting in losing customers. No problem is too small, the more complaints you resolve the deeper the loyalty. 

Go Digital!

When it comes to loyalty programs, implementing digital tools can make it easier and more exciting for clients to use. There are a multitude of benefits for owners to go digital such as:

  • Enhanced data collection
  • Data-driven insights
  • Better customer experience 
  • Direct communication with customers
  • Tailored rewards
  • Spontaneous rewards

And these are only a couple of benefits. Going digital will make using the loyalty program much more convenient for both you and your clientele. 

Should a Loyalty Program be Free?

Places like bars and restaurants have free rewards programs that incentivise customers to come back on repeat visits, but not all businesses operate like that. Luxury hotels, for example, do not always offer their entire loyalty programs for free and have paid tiers. So which is better, paid or free? I think that the answer to that is based on the business. A loyalty program for a bar and/or restaurant should always be free to the customers. The purpose of the loyalty program is to engage customers and encourage them to come by over and over again. If you were forced to pay for the program, it would turn the vast majority away, leaving only those who are extremely loyal, possibly paying for it. Asking customers to pay more money to get more value out of the food they buy there is asking too much. 

On the other hand, luxury hotels are a completely different situation. Hotels aren't just selling food or drinks, they are selling the entire hotel experience. They have a lot more they can offer such as a free room for a night or a free massage. Customers who spend the night at these luxury hotels multiple times a year most likely can afford to pay for a top tier loyalty program as well. Not to mention that giving away a free night at the hotel to a customer is much more expensive than free wings at Buffalo Wild Wings. It all depends on the business whether or not there should be a paid option for loyalty programs.

Use Marketing Tools to Advertise

Marketing is key when trying to introduce a new loyalty program to your customers. Through marketing like promotions, emails, websites, posters and more, you can educate your customers about the new loyalty program. Marketing can even help spread your reach to new people, increasing traffic for your business. You can even rebrand to something more enticing and use the marketing tools to pull in new customers. 

Overall, loyalty programs are extremely beneficial to any growing business. Creating a clear and simple to use loyalty program that is unique will help boost sales by giving customers the power to choose how they want to be loyal to you. This ultimately results in them feeling encouraged to come back again and again. 

Increase Customer Foot Traffic with The Fan’s Place

This is where the Fans Place comes in. If you own a bar or restaurant and want to implement a unique loyalty program to increase customer engagement and retention, then look no further. The Fans Place through gamification engages customers in a free to play fantasy sports program. The program runs contests every week with the chance to win credit to the bar/restaurant, or in some cases, cash prizes. Sports fans will come in every week to compete for these prizes, buy food and drinks as they watch, and if they win credit then they will come back to use it. Not to mention that customers must come in once a month to get the code to participate in the contests for that month. Sign Up for Fan’s Place - a unique  sports-based, zero-hassle, no-stress, rewards program (https://www.thefansplace.com/). To learn more about us check out our about us and business pages. 



Read other related blogs