How to create powerful customer loyalty
Loyalty cards have been around for years. My first loyalty card was my Boots Advantage Card, from 1997 – it’s now battered and funny shade of pink but I still love it. It offers 4 points for every pound spent and each point = one penny. The points add up quickly so I can often treat myself to a free lipstick or save them for something bigger. It’s a great example of how a loyalty program keeps their customers coming back. Boots invested £30 million into the card and it became the third-largest reward program in the country.
So how can independent retailers compete? We’ll show you how you can do it even better and for very little cost.
Why should you have a loyalty scheme?
Did you know it costs a business around 5 to 10 times more to acquire new customers than it does to sell to existing ones? Existing customers spend 67% more than new customers.
You work hard to get customers to visit you. Now you need to make sure that you keep them coming back! Offering something you can only get in store is key. The movement to support local independent retailers is growing, and offering a loyalty scheme helps you stay ‘front of mind’ for your customers.
Create an engaged, loyal community
Give the customer something they will love. Make them feel part of something. Use it to create an engaged and loyal community for your business. Create a club that your customers want to be part of.
Many shoppers are becoming desensitized to discounting. Shopping with you just because they can get something cheaper won’t generate loyalty – they’ll soon switch once someone else offers it them cheaper. Think more creatively about rewards.
We used to invite our customers to ‘Teatime Tuesday’ where we’d give out free tea and cake. It was great fun, encouraged customers at a time that was usually quiet and created a community feeling. Encouraging customers to linger always increases the chances of them spending more.
Other marketing tactics to boost your loyalty scheme:
- Save points to exchange for something for free
- Invites to exclusive shopping events.
- Collaboration with another complimentary local business
- Exclusive after-hours events
- Chance to shop sale first
- Free samples – ask suppliers to give you product samples you can give to your loyal customers
Make rewards fun, delight your customers with exclusive events or free gifts and remember to encourage them to share on social media, this creates even more desirability to be part of your club!
Stay connected with your customers.
I see many cafes that offer reward schemes where customers get a free coffee after so many purchases. I’ve got dozens of coffee shop cards in my wallet that get completely forgotten about. You need to go one step further.
Get their email address! Then make sure you use it! Email campaigns are a great opportunity to offer extra incentives and extra value.
- Extra offers and discounts
- Invite them to exclusive events
- Tell them about new arrivals
- Send them interesting blog posts or articles
- Show your personality and what you stand for – people buy from people. Show them what makes buying from an independent retail business like you so special.
- If you have retail pos software that can track individual customer spend, then target your high spending customers with small vouchers to say ‘thank you’ – they’re sure to come in store and spend more than the voucher amount!
5 things not to do with your loyalty scheme
- Charge – you are not Amazon Prime. This will put even the most regular customers off.
- Make it too complicated. “Fourteen points equals one pound, and twenty pounds earns 50% off your next purchase in April!“… that’s not rewarding, that’s a headache.
- Make customers wait too long to get rewards. Make the rewards accessible. Give people the option to redeem at a lower rate e.g. £10 instead of £20. Make it feel achievable.
- Spam your customers. Do not use your customer emails to send too many emails or irrelevant emails. If your customers can be segmented you could send targeted emails to different customer types. This may be possible to implement on your pos software
- Create barriers to use the scheme. If you have a loyalty card you will find that many of your customers will forget to bring it in to store with them. Create a system where you can still track their spend – retail POS software is perfect for this but you can also create a manual system or use spreadsheets.
- Ask for too much personal information. Most customers are now wary of giving away lots of information, keep what you ask for as basic as possible
Finally … don’t forget to tell people. You need to promote the fact you have a loyalty scheme.
- Make sure all your team asks every customer if they’d like to join.
- Promote the offer with signage in-store.
- Shout about it on social media.
- Encourage your best customers to invite their friends to join.
Visit www.facebook.com/storiesmarketinguk for more tips for independent retailers, what’s going on in the retail world an opportunity for you to share what great things you’re up to.
Want more help creating a loyalty scheme or turning your store into a thriving destination? Stories Marketing can support you. We run workshops and retail training for indie retailers but particularly love working one to one with our retail consultancy to help you create powerful marketing, exciting merchandising or figure out how to tackle problems you’re facing. Get in touch at firstname.lastname@example.org