WHAT IS A LOYALTY PROGRAM?
A loyalty program is a marketing strategy, designed to encourage customers to continue to shop at or use the services of a business associated with the program. Loyalty programs can be a great way to increase customer loyalty and engagement. By offering rewards and perks, customers are more likely to continue doing business with a company and recommend it to others.
WHAT IS CUSTOMER LOYALTY?
A customer’s loyalty is their willingness to keep coming back to a company to do business. This is usually because they have had such good experiences with the brand in the past. The ability of your customers to assist you to build your business more quickly than your sales and marketing teams is one of the key reasons to reward client loyalty. Customer loyalty is important to your success for a number of other reasons.
RELEVANCE OF LOYALTY PROGRAMS
Customer rewards have turned out to be an essential factor in maintaining the growth and a business. Despite being referred to as cheap promotional devices and short-term fads by the business press, these programs have been thriving around for more than a decade. In fact, more and more companies are implementing customer rewards programs, showing that they are here to stay as this program has shown to be effective in retaining customers and boosting growth. From online food ordering platforms lowering their fees to getting a greater number of orders to airline companies offering frequent flier deals to their passengers, organizations are spending a huge amount of money developing and implementing reward programs.
BENEFITS OF LOYALTY PROGRAMS
Customer loyalty is a goal that all businesses should crave. Here are the major benefits.
1. Increased share of wallet
The amount of money a customer spends on a certain brand compared to how much they spend on the brand’s competitors is known as share-of-wallet. Customers are more likely to convert and spend more time and money with brands to which they’re loyal. This creates more opportunities for share-of-wallet.
2. Increased brand recommendation
With brands to which they are loyal, customers redirect and spend more time and money. Additionally, these clients recommend the brands to their friends and peers, resulting in increased referral traffic and word-of-mouth advertising.
3. Increased faith
Customers who frequently choose to do business with your firm are more likely to have faith in your brand because they believe that the benefits of the relationship outweigh any potential advantages, one of your competitors could offer them. The idea of rallying and motivating your present customers to bring in new ones by simply promoting a brand should thrill marketers, salespeople, and customer success managers alike, as we are aware that acquiring new customers is more expensive than keeping existing ones.
HOW DO YOU OVERTURN SIMPLE PROMOTION INTO BUSINESS AND BUILD LOYALTY?
1. User Generated Content
By promoting user-generated content (UGC), businesses may increase and preserve client loyalty. The UGC strategy gives your audience a sense of being noticed and included in your brand. You can build a hashtag that people use to participate in your program in order to achieve a successful UGC campaign. Many clients will participate simply to have their photos or tales posted on your business page. Or, if you offer an incentive, such as a prize, they might join in the fun.
Examples of user-generated content: Video equipment company GoPro uses UGC to sustain its YouTube channel, with its top three videos all originally filmed by customers. As of December 2021, those three videos have racked up over 400 million views combined. Not bad for content that cost GoPro nothing to produce. In fact, UGC the company got so big, they now run their own awards show and promote daily photo challenges to inspire their customers to get creative.
2. Connect with better communication
Customer trust must be earned and kept through constant communication. Customers will interact with you more favorably when they have confidence that you are an honest and open company. This need to remain the case, particularly when it comes to customer service and a problem that needs to be fixed.
In order to have effective communication, you must let your clients know what is happening with your company. It should be clearly conveyed if there is a new product, a significant change, a corporate update, a shortage, a change in hours, or anything else that customers should be aware of, so they are not startled. This is a crucial component of providing excellent customer service that will encourage clients to keep doing business with you.
3. Get individualized
Sending personalized emails to customers is a great way to increase engagement rates. In the email, address the customer by their name, and include a personalized message that appeals to their unique interests. For example, you can send special greetings and offers on their birthday and customer anniversary to treat them to something fun. This type of gift builds emotional ties and positive feelings toward your brand.
In addition to customized emails, personalization can also be used in retargeting campaigns to existing customers. A remarketing campaign focusing on past customers can encourage them to come back and make a purchase, and even upsell them to higher-value products. Since you already have information on what they are interested in based on past purchases, you can easily create tailored product recommendations that will entice them to engage and convert.
4. Unfold your business over time
The market and the preferences of your target audience and clients will change regularly. Customers are reassured that you will always be creative and provide the greatest solutions for fulfilling their wants if you conduct study and keep current in your field. However, this isn’t limited to modern technology.
Branding, culture, marketing, and your product itself should all be evolving. Customers grow to trust businesses when they are assured that they won’t stagnate. Being able to consistently enhance your company guarantees that you get better. Customers who are certain that they are constantly receiving the finest will be more loyal to your company and its products.
WHAT ARE SOME WAYS THAT CUSTOMER LOYALTY CAN IMPROVE THE BRAND IMAGE?
Frequently, loyal customers provide reviews of your products and services to their networks, which heavily influences other customers’ purchasing decisions. You may post endorsements, client comments, and reviews on your website or social media sites. Criticism, offered sincerely, can help you increase sales, build customer confidence, and offer better goods and services. All of these actions will help you maintain client loyalty and boost your company’s reputation–way beyond what brand awareness advertising could ever accomplish.
HOW CAN CUSTOMER LOYALTY LEAD TO COST SAVINGS?
Serving loyal customers is incredibly cost-effective because they are repeat customer who already know about the goods and services you provide. Social sharing and word-of-mouth marketing from these customers can promote your business to their friends and family, reducing your costs for services and marketing. You can easily contact loyal customers about new goods, sales, or company news because you already have their contact information, and they likely follow your business on social media.
FORECAST ACCURACY
Forecasting plays a big role in how you run and manage your business. Having accurate forecasts can help companies predict growth rates, make spending decisions or offer discounts, and be prepared for tough times. Your company can also get valuable insight into things like what your product or service is worth, what areas need improvement and what kinds of new products or services your customers might be interested in, all from the feedback of loyal, regular customers. Plus, since they buy from you often, these devoted customers can help smooth out any ups and downs in buying patterns and give you a more realistic idea of what to expect In terms of sales.
DO YOU’RE BEST AND GO ABOVE AND BEYOND WHAT IS EXPECTED
Every successful brand is built on its loyal following of customers. As long as you continue to provide the quality that these clients need, they will always be willing to pay for your goods and services. Loyalty results in consistent income and lower demands on your marketing budget, ad spend, and acquisition charges. This is why you must go above and above to keep current clients and inspire loyalty to your business. You may benefit from fostering and sustaining client loyalty by heeding the advice given above.
BENEFITS OF LOYALTY PLATFORMS TO THE HOSPITALITY INDUSTRY
Loyalty programs are beneficial to the hospitality industry because they encourage customer loyalty. Customers who are members of loyalty programs are more likely to return to the same hotel chain or restaurant chain, which leads to repeat business. In addition, loyalty programs can help businesses to identify their best customers and offer those tailored services and benefits. This can further increase customer loyalty and satisfaction.
