What’s the Incentive? Getting Customers On Board With Your Loyalty Program

Most customers who walk in your door are likely already members of one or several loyalty programs. In fact, 83% of consumers belong to one or more brand/store loyalty programs, and 13% belong to five or more. So what’s the incentive for them to join yours? Recruiting for your loyalty program requires aggressive, targeted marketing just like any other major initiative would. Give your customer a reason to join your loyalty program—loyalty programs aren’t just for big businesses anymore, and it’s time to get your small business on board.

Know what works and what doesn’t

Even though loyalty programs aren’t just for big retailers anymore, there are plenty of lessons you can learn from their experience.

Reward your customers for coming back

It seems like common sense, but many loyalty programs fall short by not providing a clear incentive to keep visiting and spending. Instead, the benefit gets complicated and lost in a convoluted series of points systems and reward costs, and your customers lose interest in earning their reward.

The key is to keep it simple and keep the incentive clear. For instance, Apple rewards big spenders for coming back over and over, offering swag to customers who spend more than $5,000 over the course of a year. It’s that simple: just come back, and spend, and you’ll be rewarded for your loyalty.

Clearly, Apple products are big-ticket items, and your small business may not see most customers dropping thousands of dollars in a year. However, tweak that model a bit by rewarding your biggest spenders on a regular basis, and you have an irresistible reward that keeps customers coming back.

Market, market, market

You’d be shocked at how many customers come into your location every day and still aren’t aware of your loyalty program. It’s not enough to have a little stack of loyalty cards standing by the register; they get lost in the hustle and hurry to order or pay and move on. Invest marketing efforts into showing your customers what you’re offering and how it benefits them.

Marketing Metrics, by business marketing analyst and professor Paul W. Farris, says that return customers present a 60-70% higher likelihood of purchase when walking through the door, while new prospects have only a 5-20% chance of purchase. The customers who already know about your product are the most likely to have interest in participating in your program, so focus most of your efforts on creating a following with regulars.

If you’re already collecting customer data, as you should be, then target repeat customers by reaching out to them via e-mail if they’ve opted in. Social media is another way to reach out to your existing customer base and let them know that you’ve launched a loyalty program.

Finally, don’t forget to utilize your staff, as they’re the most powerful marketing tool that you have. Repeat customers who are already in the database take just a second to register for your loyalty program, so make sure that your staff emphasizes the reward and ease of registration. Even customers who aren’t in the database take moments to register, as better loyalty programs don’t require more personal information than a name and an e-mail address.

Keep a critical eye open

Once you’ve cracked the formula and have a steady stream of existing and new loyalty program participants, don’t relax yet. Check to see whether customers are participating to the fullest extent, and whether they’re redeeming rewards. If customers aren’t earning or redeeming frequently, then it’s time to reevaluate your approach and see where you’re falling short. There’s always room for improvement, especially when it comes to customer loyalty and retention.


Photo credit: nist6dh by CC BY-SA 2.0