How to Craft a Creative Loyalty Program

In the current economic climate, retaining customers has become just as important as acquiring new ones, especially for small businesses trying to navigate the increasingly competitive commercial landscape. Businesses are constantly on the lookout for new ways to engage with their customers and improve their shopping experiences. When it comes to adding value to your customers’ lives and encouraging them to stick around, there’s nothing like offering a fresh, fun, and creative loyalty program.

What Is a Loyalty Program?

A loyalty program is a structured marketing strategy designed to encourage repeat business by rewarding customers for their loyalty. These programs typically involve offering customers various incentives, discounts, or exclusive perks in exchange for their continued patronage. The primary goal is to create a mutually beneficial relationship between a business and its customers. Loyalty programs are highly customizable and can offer anything from discounts and cashback rewards to free products and exclusive member-only events.

Benefits of a Loyalty Program

The incentives for customers who participate in these programs are quite clear, but what do businesses stand to gain from spending time crafting a creative loyalty program? Here are some of the key advantages businesses of any size can expect when implementing their own program.

Customer Retention

An effective loyalty program establishes a strong connection between your business and its customers. It allows your business to give back to your loyal customers in the form of incentives and rewards that add value to the experience of shopping with you. This increase in value encourages customers to continue supporting and engaging with your business rather than seeking alternatives. In fact, a Forrester survey found that loyalty program members spend an average of $99 more than non-members within a 3 month period.

Word-of-Mouth Marketing

Lots of loyalty programs offer rewards in exchange for customer referrals, motivating customers to recommend a business to others in their network. Even without that extra incentive, a good loyalty program makes customers excited about engaging with your business. As a result, they will be more likely to become brand advocates who recommend your business to their friends and family. Since people tend to trust the recommendations of those close to them more than an average advertisement, this can be a great way to attract and retain new customers.

Competitive Advantage

Small and midsize businesses deal with a huge amount of competition on a local level and from larger corporations. A well-designed loyalty program can be a stand-out feature that helps your business distinguish itself from its competitors. After all, customers will be more likely to stick with a brand that offers them additional value through rewards and incentives.

Strategies to Build a Successful Loyalty Program

Before you can start enjoying all those benefits, you need to create your loyalty program. But, how do you build a program that will actually attract and sustain attention from customers? Use these strategies to go beyond the basics and make your business’s loyalty program stand out from the crowd.

1. Set Manageable Goals

As you begin putting together your loyalty program, think about what you’d like to accomplish. Is your main goal to attract more customers? Or, do you want to re-engage dormant customers and encourage them to check out your new products? Set clear, manageable goals for your program and tailor the rewards and incentives you offer to push customers in the right direction.

2. Understand Your Customers

An effective loyalty program must cater to its intended audience. If you offer rewards that your customers won’t have any interest in earning, chances are you won’t see an increase in engagement even after you kick off your loyalty program.

Utilize insights derived from customer data to figure out the needs and preferences that your business could satisfy. As you customize your loyalty program, include incentives that flow naturally from your customers’ behavior. Create rewards that will entice them to prioritize your business and continue to engage with it rather than your competitors.

3. Communicate Potential Rewards

Customers can’t take advantage of your loyalty program if they are unaware of the rewards you have to offer. Make an effort to market relevant incentives to your customers, especially for rewards that may be designed to cater to specific customers. For example, if you choose to provide a discount to customers who re-engage with the business after a certain period of time, it would be wise to send out an email notifying dormant customers of the offer.

4. Integrate with Social Media

Don’t forget to leverage social media platforms as another means of promotion for your loyalty program. You can advertise the program itself on your socials or encourage customers to share their rewards with their network. In this fashion, you can start to build a community around your business that will entice others to join the program as well.

5. Adapt and Grow

It’s important to regularly assess the performance of your loyalty program and gather feedback from customers. Use this information to adapt and refine the program to better meet the evolving needs and preferences of your customer base. Find new ways to refresh the program over time to keep customers excited about what’s next.

Make It Easy with Ostana

If creating a loyalty program sounds like just another addition to your long list of tasks, let Ostana make it easy for you! Our online platform allows you to build your perfect loyalty program in a matter of minutes. Join today to become a part of our ever-growing network of small businesses and start engaging with your customers on a whole new level!