Five Major Benefits Of Using Loyalty Programs

By Tom Griffith, Merchant Payment Services

Every year consumers are faced with thousands of buying decisions, from buying a cup of coffee to buying a home. Businesses are tasked with finding ways to keep consumers buying from their companies. So, how do you keep a customer buying from your business?

One trend is the use of customer loyalty programs. One study has shown that companies increase revenues by nearly 50% by retaining only 5% of their customer base. Loyalty card programs offer the perfect solution for helping to retain your most loyal customers. Loyalty cards reward customers for their purchases, giving them a compelling reason to choose your business over another and keep coming back. They also allow you to track the purchaser’s behavior and capture a customer profile for use in market research. Unlike paper gift certificates, gift and loyalty cards have no value until you activate them at the register.

Here are five benefits of launching a loyalty program:

• You will drive repeat sales. Selling to existing customers is a lot easier than attracting new ones. Having a loyalty program will drive consumers back to your business to repurchase items and take a look into new ones.

• You will get to know your customers better. By having customers create a user profile, you learn more about their personal lives and buying habits. This allows you to finetune your products and services to better fit your customer base.

• You will increase user-generated content. In a world of social media, consumers love to talk about their favorite and least favorite things. Rewarding your customers for their loyalty can lead to an increase in positive social media posts for your company. You can also reward customers for writing reviews, answering questions and uploading photos.
• You will enhance your customer experience. If a customer receives positive treatment, like getting something extra for their money through a loyalty program, they will be more likely to make repeat purchases and referrals.

• You will maximize your brand advocacy. Loyalty programs are meant for the top 20% of your customer base. These customers drive 80% of your total sales by spending more over a longer period. Loyalty programs help customers engage with your business and allow them to promote your brand to others.

There are a variety of loyalty programs. For instance, you can issue coupons once a certain amount is spent, give discounts on specific products, invite participants to special events and much more. Find the program that best fits your company and customers and start rewarding your most loyal customers. As you research loyalty programs, turn to a BBB Accredited Business, like Merchant Payment Services.