loyalty programs for beginners

When 79% of customers say that loyalty programs encourage them to stick with one store and 70% of Millennials appreciate the value of such programs ( The Loyalty Report by Bond), we know how important Customer Loyalty programs are in today’s age and time.

While they promise high return on investment, they allow you to listen to feedback and better understand your customers. Sometimes they can even build brand value and generate ambassadors for your brand or products.

So before building a brand program, you should start by taking a broader view of building customer loyalty. Once you have loyal customers, you can start thinking about a customer rewards program.

Here are 7 steps to set up a loyalty program

  1. Research & Analyse
    Engage in some market research. Understand the market dynamics, competition and most importantly your TG.   Then understand buying behavior and user types. Identify all possible upsells or cross-sells that both make sense to the client, and increase the customer value for you.
  2. Explore loyalty
    Define the characteristics of the users you want to retain and make loyal and determine the metrics you will use to measure loyalty. What additional steps can you take to stimulate customer satisfaction, branding, and user experience.
  3. Calculate worth
    Make projections for the value you can create with rewards. Remember, you will be reducing your margins in your program, so you need to make sure a discount or a reward is worth it.
    You will also invest resources in setting up and running the program, so you need to calculate how big a reward you can give to loyal customers and within what horizon of time.
  4. Design
    Based on the research, design the most suited loyalty program with omni channel experience to engage the TG with personalised experience and rewards that match them instantly.
  5. Build strong Communication
    Once the concept is established, think about communication. Name your program and make it tangible so members can feel and touch it, and feel proud about it. Though a card is one of the preferred ways to make it concrete, but it could also take the form of a pin or a sticker
  6. Results matter
    Finally, measure results on an ongoing basis. Analyse redemption trends and take feedbacks from customers on regular basis. And you will know if your projections were correct and the program is generating value or not.
  7. Restructure
    It’s always a good idea to learn from past and take corrective measures to revamp the existing program for ROI and generating greater Customer experience.

Always remember, Loyalty programs that are data driven, feedback driven and market driven make for a successful product. If you delight customers, there is a good chance a loyalty program will go places and take you places!

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