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Gain Loyal Customers with Loyalty Programs

Do you know how many loyalty programs you’re enrolled in? If you’re like most people, the number is likely too high to count, but digging through your wallet of tattered rewards cards or holding your key chain heavy with barcode cards says it all.

It’s no secret why brands love loyalty programs: they are one of the best ways to reward current customers and keep them coming back for more. Because new customers are harder and more expensive to obtain than it is to retain current subscribers, putting marketing dollars and resources behind loyalty program is a strategic and cost-effective way to nurture relationships and inspire new ones.

If your brand is looking to launch a new loyalty program or optimize the one you already have, take note of these five best-practices that produce results:

  1. The simpler, the better. Whether you are just launching a loyalty program or are working to boost enrollment in one that already exists, the most important factor in program success is how easy it is to join. The strongest loyalty programs have a simple enrollment process and require minimal paperwork to start earning rewards. Gather the bare-minimum data you need to make the program work (typically name and some form of contact information) as it both cuts down on enrollment time and creates less of a security risk for customer information. Then, format the program so customers can earn and take advantage of rewards using that same information (i.e. entering a phone number at check-out or logging in online to receive a discount) rather than complicated processes that unnecessarily waste people’s time and energy.

  2. Offer small but frequent rewards up front. Customers that are rewarded more frequently are more likely to use loyalty programs, even if the initial rewards are small. Systems in which customers can begin earning points with their first purchase or immediate enrollment perks like sign-up bonuses or discount codes will encourage subscribers to keep coming back for more. Starting small also allows businesses just launching loyalty programs to play it safe. It’s easier to increase rewards as your program grows than it is to scale back or eliminate loyalty perks all together.

  3. Take advantage of partnerships with other businesses. Consider establishing partnerships with large employers, restaurants, clubs, and media that will enhance your loyalty program’s effectiveness and reach. Not only does collaborating with well-known and respected brands help establish and bolster your reputation, but it also allows marketers to reach new audiences they might otherwise be missing.

  4. Minimize rules and eliminate tricks. Customers prefer loyalty programs with a clear structure and few rules. If program subscribers are constantly jumping through hoops to use the rewards you promised, they will likely take their business elsewhere where earning incentives is less confusing and more attainable.

  5. Allow employee training to serve as a checkpoint for your loyalty program. An obvious sign of an overly complicated loyalty program is if employee training for the program is very extensive. Most successful loyalty programs aren’t sophisticated. If your program requires layers of technology, equipment, or special training to function, it’s probably too complex to deliver the results you want. Remember less is often more, so eliminate the bells and whistles of your loyalty program to unearth a straightforward process that satisfies both customers and employees.

Loyalty programs are an effective tool used to engage current customers and help garner new ones. By following these best practices, your loyalty rewards program will help cultivate and maintain customer interest, so they keep coming back for more.

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