"The purpose of a business is to create and keep a customer."
It costs 7x more to acquire new customers than retain existing ones! And 82% of companies agree! This is exactly why growing a loyal customer base is key to success. The added bonus is that it only takes a 5% increase in customer retention to see profits jump by as much as 95%.
When you partner with Incentivesmart, you'll receive not only our top-rated loyalty management software but also the support and guidance from our friendly team of experts. To make sure your customer loyalty programme generates tangible results, there’s five essential questions you must answer first...
1. Who do you want to incentivise?
Start by considering your audience. Will the programme be open to all of your customers or dealers? Perhaps you'd like to use the programme more tactically to drive sales from a targeted audience.
With the Incentivesmart platform, you can scale your reward programme to suit your requirements. You’re able to segment your audiences so you can send targeted messages and have more flexibility in how you award points according to the criteria you set for each group. And remember, it’s not always a one size fits all approach!
But don’t worry if you're unsure about who your audience is. You can always make your programme available to everyone. From there, you can send out communications and engaging content to ensure a high volume of sign-ups from which you can gain further data. This will help to formulate a more accurate picture of who your customers actually are.
Incentivesmart's advanced MI suite enables you to learn more about your users through a wide range of reports and analytics. From detailed activity reports to the segmentation and demographics, you can gain a real understanding of your buyer's behaviours through their interaction with the platform.
2. Do you know what's driving your customers?
When you understand your customers, you can work out what will motivate them to exhibit the behaviours you'd like to see. Some buyers want to work towards specific rewards; others enjoy a bit of healthy competition and like to see their points tallying up. Speaking of which, our leaderboards are a great way to positively drive the competition.
58.7% of internet users state that their shopping experience is enhanced by the opportunity to earn rewards and loyalty points. Incentivesmart can help you build a flexible reward catalogue around your audience to ensure that your rewards are inspiring and aspirational.
Lastly, it's important to see things from your customer's perspective. If your competitor also has an incentive programme, how will yours stand out? Make sure your offer and its delivery are unique and attractive to your customers. There are no gimmicks to winning customers over! After all, loyalty is fostered when you take the time to actually learn about your customer and their concerns.
3. What are you looking to achieve, and how can you measure the change and success?
As with all new initiatives, your business needs to have clear objectives for your customer loyalty programme. Defining your goals will shape the direction of the programme. So make sure to take a step back and ask yourself what the purpose is.
- Do you want to increase your market share?
- Do you want to get more sales and cross-sales?
- Would you like to reduce customer churn?
- Are there specific KPIs you'd like to improve?
From here, you have to have a strong vision of what success looks like. Your Incentivesmart Client Success Manager will be able to work closely with you to review the programme statistics and ensure the results are on track to achieve your quarterly and yearly goals.
It may also be an idea to use a control group to measure the success of the reward programme. A control group will allow you to compare the performance of customers on the programme who are being incentivised, to the performance of those customers who have not taken part in the programme and are not being incentivised.
4. How do you currently track your sales?
To incentivise your customers, first you need to understand how often they are purchasing and their habits. Having a reward platform in place may give you access to essential data from which to expand your planning and strategy. When you have insight into why specific customers are purchasing your product and how they are using it, you may spot new opportunities to develop your product and access new markets.
5. What is the reward criteria?
It's important to determine how many points you'd like to award for each type of positive action your customer or distributor takes. But remember, all positive actions are not equal: therefore, rewarding certain behaviours accordingly is essential. You wouldn’t offer 100 points worth £100 for an hour of training, but you might if the person took a training course for a week.
When doing this, consider your average profit margin on your products and what would be an affordable percentage to give back in points. This will ensure that you're not attributing a large rewards percentage to low-value transactions, but you can still recognise cross-selling and up-selling efforts.
It's always better to start with a consistent and sustainable baseline of points, so your users know what's expected of them and how they can benefit from the programme. You can then make it more exciting by offering promotions and bonuses, such as double points, as the programme progresses.
When you have your successful programme up and running, don't be surprised if you start seeing referrals going up! More than 70% of consumers are likely to recommend your brand if they enjoy using your loyalty programme. You can even incentivise this specifically to get more customers on board.
Book a free Incentivesmart demo!
We want to help make sure that we're the right partner for your customer loyalty improvement strategy, so we carry out personalised demos that will look to understand your needs.