With the exponential growth of social media, many small businesses wonder how to capitalize on their phenomenal ability to communicate with customers. One way is to develop a solid platform for building customer relationships: A loyalty program.
Customers usually flock to loyalty programs for instant savings and rewards. But a business’s true goal of these programs is to build stronger relationships. Yes, customers get discounts, but a loyalty program real aim is long-term sales growth. A good program will help differentiate you from your competition, increase return visits and stabilize revenue.
While adding a loyalty program is a big undertaking, the Bank of America Small Business Payments Spotlight shows that businesses often see distinct benefits:
Like any business asset, loyalty programs come with a cost. Regular customers will expect discounts and rewards, and new customers may only be interested in the savings. Small businesses need to measure the profitability of the program and carefully weigh the true costs of the discounts and rewards they offer. How many sales do you need to make to offset a 5% discount? How many new active members do you need to justify that $25 reward you're offering?
To help you get started, here are three keys to starting your loyalty program:
There are many different ways to manage a loyalty program. You can use physical objects like punch cards or swipe-able membership cards. Or you can use digital loyalty cards, saved phone numbers or even a personalized app. With Clover Rewards, your business can easily integrate a loyalty program inot your system that makes sign up easy for your customers and redemption easier for your staff. Bank of America Merchant Services can help you find the right Clover Rewards program for your business.
Before you start offering discounts and rewards, you need to set solid goals. Look at your business model and figure out what program offerings will benefit you the most. You need to consider preference too. Here are a few things that they tend to want:
Now figure out how to personalize your reward to align with your goals. Want to increase traffic? Have a reward that can be redeemed or earned daily. Cash back or free products can be great incentives. You can also try offering a discount on future purchases.
When marketing your new program, consider your target customers. Do you want your program to help attract new customers? Create a new member discount. Do you want to encourage repeat purchases? Offer them a reward at the register after their first purchase to be used on a subsequent visit.
Also be sure to collect contact information when customers sign up so that you can email lapsed customers to spark a return. Catching customers at the right moment will help them see the value in your program.
A loyalty program has financial implications for every business, but a happy, loyal customer is a priceless asset. Speak with a Bank of America Merchant Services representative to see how they can help you develop a program for your business.