The holiday season is round the corner and you are deliberating if its the right time to launch a loyalty program to boost your sales. Should you just wait for the next holiday season or should you launch it now in preparation for the next occasion?
In this blog post, we’ll discuss on the most important topic on whether a loyalty program is suitable for your business. Loyalty programs aren’t for all business especially if your customer base isn’t big enough. But a loyalty program is most suitable for you if your business is strategized to achieve the below intentions.
- FOSTERING CUSTOMER LOYALTY TO ACHIEVE HIGHER SALES GROWTH
There has been studies proving that in comparison to new customer, loyal customers spends 10x more and they are 5x more likely to purchase (RJMetrics).
Times have changed where acquiring new customers is no longer the best solution to boost your business. Stats have shown that it will cost retailers 7x more than retaining a loyal customer.
- STAND OUT FROM YOUR COMPETITORS BY PROVIDING EXPERIENTIAL EXPERIENCE
Times different now, people are no longer believing that retail is dead, but it’s actually the means to an end. Customers are looking for special care, acknowledgement and recognition, in short customers are seeking guidance from retailers.
A well tailored loyalty program can work wonders for a business, acting as the missing piece to achieve success, providing the extra charm and attentiveness towards customers. Basing on a study form Nielsen: 72% of customers would buy from a retailer with a loyalty program over one without. Ever wondered why? A retailer with a loyalty program always have something sweeter prepared for their customer, something more personalized and valuable.
- HOW MUCH MORE CAN YOU DO TO STAND OUT TO BE A LEADER IN CONSUMER LOYALTY
Nielsen studies has forecasted that by 2021, the demand for loyalty program will increase by 300% especially in the retail sector, and this was a studies conducted in 2016. Even though basing on a 2016 stats, but unfortunately the facts is that most of these loyalty programs are based off the old school methods – the same old plastic card! To make things worse, customers are forced to fill up excessively lengthy membership forms.
But the simple fact is that customers are looking for loyalty programs which are flexible and convenient to use for both online and offline strategies. This in return will define the success of a loyalty program. For those of us who has been to Starbucks will definitely agree that they are a real role-model in the loyalty program trend.
On a slightly different note, Nielsen’s study has indicated that 67% of retail customers prefers if a loyalty program is combined with a mobile payment platform. A total of 62% of them appreciated if they could collect point for being active in social activities related to the retail brand.
Now, on to one of the main reason for this article. How do you know when is the right time for you to launch your loyalty program? Before even thinking of subscribing to a loyalty program, below are some of the possible goals your business need to achieve, and what can influence the exact launch date of your loyalty program.
- PLANNING IT AROUND A SPECIAL EVENT OR OCCASION
There is no one in this world who doesn’t like to be delighted or even surprised, imagine implementing this with a loyalty program. Exploit special occasions, launch your campaigns around an occasion to leverage on the anticipations. Launch them for occasions such is:
- Store Anniversary
- Hari Raya
- Chinese New Year
- New Years
- Black Friday
- Alibaba’s Singles Day @ 11.11
- Back to School Campaigns
- And more…
But keeping all the hype aside, you should never forget the your business need to be prepared and ready for two primary hurdles.
- Ensure that the loyalty program of your choice is seamlessly and also technically integrated with all your current operational systems
- Prepare a complete marketing strategy to promote your newly adopted loyalty program
- COMBINING TECHNOLOGIES
According to a report from eMarketer, 65% of shoppers expects personalized offers and promotions from retailers. This is one the the main reason to why retail brands adopt loyalty programs into their existing retail technologies as loyalty programs helps them enhance customer personalization. Moving towards the up and coming retail technology, loyalty programs are starting to see integration with proximity marketing such as Apples iBeacon and Goodles Eddystone Bluetooth Light Energy (BLE) technology. With this technology the above mentioned stats can easily be mitigated.
As a conclusion, deciding on the right time to adopt a loyalty program has two sides. First, is to ensure that your business direction and vision is consistent even after the implementation of a loyalty program. As a retail brand, you must always question the objective of implementing a loyalty program, and do you aim for objectives that modern, gamified loyalty programs achieves? For example:
- Customer retention is more important than customer acquisition
- Competition through experience-based differentiation and not through a price war against your competitions
- Implementing new technologies to enhance in-store automated personalization, and hassle free retail experience
Once you are able to achieve all the objectives, you are then ready to launch your very own loyalty program. But please do not forget that a successful program launch also requires the following:
- Flawless integration with current in-store retail technologies
- A well planned marketing strategy to promote your loyalty programs to your customers