One of the most powerful ways to deepen customer loyalty is to reward your customers for sticking with you. This is why loyalty programs are so popular. Plus, customers actively participating in loyalty programs not only continue to buy from you, but they spend more money when they do.
According to a recent study by Oracle:
- 72% of U.S. online adults belong to at least one loyalty program.
- In a typical three-month period, loyalty program members spend $42.33 more with traditional retailers (those with physical stores) than shoppers not in a loyalty program.
- The highest penetration — more than two-thirds of consumers in loyalty programs — occurs in high-frequency activity categories like grocery and drugstores.
When developing a loyalty program, think about what really motivates your customers. This may be different for different segments of your audience. For example, while many people associate loyalty programs with coupons and discounts, research has shown that overemphasizing these incentives can actually decrease engagement. Among the affluent, offers that give exclusive access or elite status (such as an opportunity to purchase wine in their own personal batch) can be more effective.
Loyalty programs can be personalized based on individual customer buying habits, or you can send general alerts, discounts and other rewards to participating members. Also, consider matching marketing channels to customer preferences (direct mail, email, mobile). Like your rewards offers, different segments of your audience might prefer different channels.
You’ve worked hard to bring in those new customers. Now make sure they stick with you!