Why Small Businesses Should Be Utilizing Customer-Loyalty Programs
Why Small Businesses Should Be Utilizing Customer-Loyalty Programs The philosophy behind a customer loyalty program is simple: Repeat customers are rewarded and businesses increase sales. It’s a basic but powerful strategy. For instance, My Starbucks Rewards, the co ee giant's customer-retention program, signi cantly contributes to the company’s record growth. Starbucks claims that the program played a key role in its 26 percent rise in profit and 11 percent jump in total revenue in 2013’s second quarter fiscal results. Best Buy also turned to customer loyalty after experiencing stagnant revenue growth year after year in its brick-and-mortar stores. To keep up with major online retailers like Amazon.com and eBay, Best Buy increased reward points from 4 percent to 5 percent last year to motivate customers to keep coming back. This strategy along with additional changes has helped the company’s stock more than doubled since early last year. Whether the goal is to continually increase sales or to jumpstart sluggish revenue, customer-loyalty programs appear to have become a staple for many large corporations. But what about small businesses? Manta’s and BIA/Kelsey’s joint report “Achieving Big Customer Loyalty in a Small Business World” reveals that for early adopters who already have a customer loyalty program in placed, 64 percent of them report it’s been been effective, meaning it makes more money than costs to maintain it. It’s important for business owners to keep in mind that customer loyalty isn’t just for big businesses – a well-designed program can help any size business scale and reach new heights.
Why Small Businesses Should Be Utilizing Customer-Loyalty Programs
Why Small Businesses Should Be Utilizing Customer-Loyalty Programs Here’s why customer loyalty programs matter to small business: A repeat customer gives and gives. Having a customer-loyalty program could help you increase repeat customers, which, in turn could boost your business’s revenue. Based on the same report by Manta and BIA/Kelsey, a repeat customer spends 67 percent more on a given purchase than a new customer does. And they should be rewarded for this action, as retaining customers is less costly than acquiring new ones. By providing loyalty programs for current customers, small-business owners are not only saying thank you but are also motivating them to continue to be their brand ambassadors. They can easily spread the word about a business to their professional, personal and social networks, helping small-business owners increase their customer base even more.
Why Small Businesses Should Be Utilizing Customer-Loyalty Programs
Why Small Businesses Should Be Utilizing Customer-Loyalty Programs Rise above the competition. It can be di cult for a small business to compete with a large brand considering that most large brands have more locations, resources, marketing dollars and the ability to o er lower prices. However, a good customer-loyalty program is an easy way for small businesses to show their personal side and remain competitive in spaces dominated by big business.
Three Big Mistakes You Could be Making with Your Customer Loyalty Program For example, many consumers may not love the co ee at a big-brand co ee chain but do love the fact they can earn points through their purchases and save money in the long run. However, it would be very simple and cost e ective for a small co ee-shop owner with quality co ee to do the same. Customer loyalty doesn't cost a fortune. Customer-loyalty programs don’t have to drain small businesses’ budget. While some corporations spill millions of dollars into loyalty programs, small businesses don’t have to follow the same tactic to achieve promising results. In today’s mobile era, cost-e ective digital rewards programs are just as fruitful as the ones put in place by bigger players. After researching many loyalty programs, we found " flok" provides the best overall experience for both the customer and the business owner. It's incredibly powerful but easy to use and unlike most loyalty programs, it also allows for on-going social media marketing, email marketing and customer communication. It also incorporates "beacon technology". When the customer enters the business, the loyalty program automatically welcomes them & pushes any specials to their smartphone. Small-Business owners no longer have to waste time and money printing cards and buying ink when they are using digital customer loyalty programs. More importantly, they’re making it easier for their customers to keep using their service. Here’s to the end of losing paper punch cards in a pile! Customer-retention programs are not just for big brand name players. They can provide many bene ts for small businesses, such as increasing sales, helping them stand out and developing a stronger relationship with their customers -- and technology is making it easier and cheaper than ever before to launch one.
Three Big Mistakes You Could be Making with Your Customer Loyalty Program
Three Big Mistakes You Could be Making with Your Customer Loyalty Program There’s good news and bad news about customer loyalty programs. First, the good news: Customers who belong to retail loyalty programs generate signi cantly more money for retailers than other customers do, according to a study by Accenture Interactive. Now, the bad news: Many retailers are focusing on the wrong things when it comes to their customer loyalty programs. Here are three common mistakes retailers make when it comes to loyalty programs, and what you can do instead to make them right.
Retail Loyalty Program Mistakes Mistake #1: Not Measuring ROI Fewer than 20 percent of retailers in the survey say return on investment is a key factor in evaluating the success of their loyalty program. Instead, the study found, retailers are focused more on metrics related to growing and maintaining their loyalty program membership. Some 45 percent measure membership growth rates, 42 percent measure the percentage of transactions by loyalty members and 36 percent measure the number of transactions by loyalty members. In addition, 40 percent focus on measuring the retention rate for loyalty programs. Make it Right: Sure, you should be measuring all of the data above. However, ROI is where the rubber meets the road. Boil down all of your retail loyalty program metrics to determine whether your investment in a loyalty program is paying o . Assess the costs of your retail loyalty program, both in terms of the fees for the program and the costs of running and promoting it, and compare that against the sales that result from it.
Mistake #2: Not Differentiating your Loyalty Program Enough
Three Big Mistakes You Could be Making with Your Customer Loyalty Program
Three Big Mistakes You Could be Making with Your Customer Loyalty Program More than seven out of 10 retailers in the survey believe their retail loyalty program is either “di erentiated” or “signi cantly di erentiated” from their competitors’ programs. However, few customers feel the same way. Research cited by Accenture shows that about one-third of loyalty program members also shop at competing retailers, and 44 percent say the competition’s loyalty program could easily replace the other retailer’s program. Make it Right: Monitor what your competitors are o ering when it comes to loyalty programs. You may even want to sign up for the programs (or have a family member sign up, if you’re worried about being obvious) so you can see how they work “from the inside.” Is there something missing from your competition’s programs that you could o er? How can you di erentiate your retail loyalty program from theirs? Use all the marketing methods at your disposal to educate customers about the value of your loyalty program. Promote it in print ads, on social media and in your email communications. Even talk it up when ringing up sales at the checkout counter.
Mistake #3: Not Keeping Up with Technology Sophisticated digital loyalty programs such as flok, are now available to even the smallest business. Many of them include additional features that help you market to loyalty program members in a more personalized way. With many customers using their smartphones through every stage of the shopping process, it often makes sense for retailers to use digital loyalty programs with a mobile component. However, four in 10 retailers in the survey say they struggle to keep up with mobile and digital loyalty technology. The same percentage say nding enough in the budget to invest in loyalty program technology is a challenge.
Three Big Mistakes You Could be Making with Your Customer Loyalty Program
Three Big Mistakes You Could be Making with Your Customer Loyalty Program Make it Right: Take your customers into consideration. If they’re young early adopters, your program needs to be mobile so customers can do everything from their phones. If most of your customers are older and not so smartphone-reliant, a mobile app may not matter as much. However, that doesn’t mean you can stick with old-fashioned punch cards. Today’s teens are tomorrow’s middle-aged parents, and they’ll be taking their tech habits into the future, so the time to catch up with loyalty program technology is now.
Three Big Mistakes You Could be Making with Your Customer Loyalty Program
90 Percent Of Retail Shoppers Use Smartphones In Stores
A recent survey of 12,000 randomly selected US smartphone users and asked them about their mobile shopping behaviors. The survey found that 85 percent of respondents said their m-commerce buying was steady or had increased versus a year ago. While roughly 15 percent said mobile buying had increased “signi cantly,� personal data security and/or poor user experiences (e.g., product images too small) were cited as barriers to the further growth of mobile ecommerce.
90 Percent Of Retail Shoppers Use Smartphones In Stores
90 Percent Of Retail Shoppers Use Smartphones In Stores However, con rming the ndings of many earlier surveys, the overwhelming majority (90 percent) said they use their smartphones in stores while shopping. The top activities on smartphones while in-stores were the following: 1. Price comparisons — 54 percent 2. Looking up product information — 48 percent 3. Checking reviews online — 42 percent Another top in-store smartphone behavior, not on this list, is seeking coupons or deals. Though not in top three above, in-store deal-seeking is consistently found to be one of the top smartphone uses. Retailers without a smart-phone driven customer loyalty program as missing a huge opportunity to communicate with customers. Two important marketing opportunities for retailers were identi ed (or reinforced) in the data: Opportunity surrounding in-store push noti cations about deals/o ers (57 percent were more likely to shop at a store if available) Loyalty programs (76 percent would be more likely to shop at a store if available) As indicated, the SessionM data con rm a well established, growing body of consumer survey and behavioral data around in-store smartphone usage. Yet most retailers have been painfully slow to take advantage of it (rather, they cry “showrooming”). Deals and loyalty programs are two reasons for shoppers to download a retailer app, which can then get them to opt-in to noti cations. Mobile payments is another reason, but in most cases, that functionality isn’t ready. 90 Percent Of Retail Shoppers Use Smartphones In Stores
90 Percent Of Retail Shoppers Use Smartphones In Stores Retailers must see in-store smartphone usage as an extension of the traditional retail experience and adapt their apps, mobile sites and in-store signage (and other marketing) to take account of and leverage smartphone shopper behavior. Believe it or not, eight years in, there’s still an opportunity to be a mobile “early adopter� in retail. More than 90 percent of respondents said they had made a retail purchase in the past 90 days. The great majority (73 percent) had made those purchases in a traditional, physical store. Roughly 53 percent agreed that the in-store experience was still superior to online/mobile shopping.
90 Percent Of Retail Shoppers Use Smartphones In Stores
90 Percent Of Retail Shoppers Use Smartphones In Stores Increase Your Customer Loyalty! 86% of business owners say Customer Loyalty is the key to growth, yet only 14% use any type of technology to build customer loyalty or market their small business!
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90 Percent Of Retail Shoppers Use Smartphones In Stores