Identifying which loyalty program company is best for your business?
Be it a business or an individual, we all have placed loyalty at the top of the list. However, for businesses customer loyalty is a driving force that keeps them in the competition and to reward such loyal customers, businesses have started integrating loyalty program in their marketing strategy and keep the loyal customers.
From the large options of customer loyalty program available in the market to choose from. It often becomes a challenge for brands to figure out which loyalty program would be most effective and suitable for their business.
Hence, in this blog we will help you understand and identify the best suitable loyalty rewards program and loyalty program company to offer you best results.
Defining Basics of Loyalty Program
In its essence a loyalty program is a marketing strategy being implemented by any business or brand to reward the loyal customers and ensure repeat business from the customers. In this process brands offer various benefits such as discount coupons, gift cards, free gifts and other additional benefits.
Furthermore, the customer loyalty program is designed in such a way that it is beneficial for both the parties involved and leaves the customer with a satisfactory experience with the brand. However, it is often challenging to identify and design the perfect loyalty program for your brand which covers all the major aspects. Hence, it is recommended to get a suitable partner such as RewardPort to help you throughout the process.
The biggest benefit of integrating a loyalty program company such as RewardPort is that you can get customized loyalty program as per your requirements and pick the suitable aspects.
Benefits of Loyalty Program
Here are some of the most important benefits that you can reap off leveraging a loyalty rewards program.
- Building customer relationships
First and foremost integrating a loyalty program in your marketing strategy would allow you to build a strong relationship with your customers, offering them a sense of belonging and connection with the brand.
- New customer base
Once you start implementing a loyalty program your loyal customers will do a word-of-mouth marketing for your brand which would push their peers, friends and family to get an experience with your brand. Hence, expanding your customer base and helping you acquire new customers.
- Increased sales, revenue and profit
Since we have already established this will help you gain more customers it is only logical that this will further help you get more sales, generate more revenue and hence more profit as well.
- Brand recognition
Since more and more customers will be getting connected with your brand, and your loyal customers will be doing word-of-mouth marketing for you, this will help your brand get more recognition in the market.
- Customer satisfaction
Customer loyalty program is one such aspect which is implemented for offering benefits to both the parties. Having said that, a loyalty program would result in certain rewards or additional benefits to the customers which would offer them a certain level of satisfaction.
What to Consider?
Now that we have established the benefits and the purpose of integrating a loyalty program in any business, let’s have a look at some key points that you need to consider when designing your customer loyalty program.
- Data driven insights
Always look for data driven insights before you start designing any customer loyalty program for your business. Data will always help you put together a clear picture and help have a better understanding of what is required and what is expected out of this loyalty program.
- Define the purpose
Define the purpose of integrating a customer loyalty program in your business. Define if you are trying to expand your customer base, maintain the loyal customer base or spread a word of marketing for your business.
- Target audience
Next step is to get a clear understanding of your target audience. This will help you devise your strategy in a better manner. Your target audience will help you get better insights about your business plan and what you wish to achieve via the loyalty program.
- Prioritize customer service
When designing your loyalty rewards program, always prioritize the customer services. Focus on offering your customers enhanced services. This will help your customers have a sense of connection with your brand and further allow them to create a bond with the brand.
Furthermore, prioritizing customer service will allow your customers to feel valued which is going to contribute to the success of your brand in the long run.
- Understand the customer needs
When designing your loyalty program rewards first understand the needs of your customers, then decide for the rewards that you want to offer. Don’t go selecting random rewards that are not aligned with your customer’s needs.
- Rewards optimization
Optimize your rewards at a regular interval to offer the customers a fresh and new feel instead of repeating the same rewards. This will further allow the customers to look forward to the rewards with your loyalty program. Always maintain the element of surprise in the program.
Loyalty Program with RewardPort
For a brand it is important to maintain and reward loyal customers. Hence, it becomes a necessity to integrate a loyalty program in their marketing strategy. In the above discussion we have already established the contributing factors, benefits, and key points to consider while integrating a loyalty program.
Furthermore, it is important to integrate customer loyalty program with the right partner such as RewardPort where you can get the program customized as per your needs and leverage different programs and services such as Sweepstakes, CineRewardz, Scratch2Win and various others from the entire offerings.
Frequently Asked Questions: -
Implementing a loyalty program would help you to offer your loyal customers with rewards and additional benefits for their loyalty towards the brand. It further helps you to establish a bond with your customers and ensure a long term relationship.
For implementing a loyalty program, define the purpose, find your target audience, set the rewards as per the customers needs, and start the campaign making customers aware of the benefits and rewards.
Implementing a loyalty program requires you to first identify the audience group or target audience. Next step is to decide for the rewards that you wish to integrate in the program and how you wish to communicate regarding the same with the audience.
How Different Customer Loyalty Programs are Changing the Dynamics of the Industry?
For any brand the most important aspect is the customer loyalty. Without a loyal customer, a brand cannot establish itself in the market. Hence, for every brand it is necessary to have a detailed understanding and strategy of employing a customer loyalty program.
But before this, let’s understand in brief what a customer loyalty program is, and how it functions.
Customer Loyalty Program is simply an act of recognising and rewarding the loyal customers of the brand by offering them certain products and rewards. These loyalty programs ensure that the customer feels rewarded and recognised for their continuous efforts and purchases with the brand.
These rewards can be cashbacks, free gifts, vouchers or discount coupons as well. Further depending on the brand, these rewards can also include the exclusive merchandise of the brand as well, making the loyal customers a part of the family.
Benefits of Customer Loyalty Programs
While integrating a customer loyalty program one should consider the various factors such as the cost for the company and most importantly how it would make the loyal customers feel.
Apart from the fact that customer loyalty program are used to maintain the loyal customer, there are several other benefits of the program as well. Here are some of the most common benefits observed from a customer loyalty program.
- Customer Retention
Using customer loyalty program a brand can easily retain the old customers by offering them various rewards and recognition. This activity helps brands to regain the customers trust and make them stay for a longer period of time with the brand.
- Increased Sales
Integrating customer loyalty program a brand can increase their sales easily, as during these activities the loyal customers are tend to make more purchases and also refer the same to their peers. This helps the brand to increase their sales, and make more profit.
- Brand Recognition
Launching any form of promotion or loyalty program in the market will allow the brand to gain more and more recognition. This increased brand recognition will help the brand to offer more and more exciting offers for the loyal customer, hence, making them feel rewarded.
- Increased Referrals
Once a loyal customer is rewarded, they will feel valued and hence, will refer the brand to their peers as well. This increase in the referrals will allow the brand to gain new customers and increase their sales.
- Increased Revenue
Increased referral results in increased sales which in the end increases the revenue generated by the brand, hence more profit. More profit further indicates more and more loyal customers are valued and recognised
Different Customer Loyalty Program
In this cut-throat competition in the market, all the brands are fighting to grab the attention of its customers. However, the attention span of a customer is very less, and the fight is to grab the attention for those 4-5 seconds.
Each brand is coming with a different strategy and trying their best to retain their loyal customers, and hence running different campaigns. Some of the most common strategies are discussed below:
- Point-based program
For every purchase that the customer makes, they get a certain number of points which can be further redeemed on a purchase when they have a fixed number of points gathered (differs from brand to brand). This allows customers to keep making purchases for more and more points, and the final redeem of the points feels like a reward to the customers.
Here you can also browse the Freebucks by RewardPort and integrate the point-based customer loyalty program into your system.
- Tiered Program
This is also a point-based system only, but when the customer has earned a fixed number of points they are moved to a different tier with different benefits and advantages. This feels like an achievement to the customer once they are upgraded to a different tier further motivating them to make more purchases.
- Paid Program
This program is simple to understand as the customers in this category pay a certain amount of monthly or annual fee to avail the VIP benefits or become a part of the VIP club. This further offers them different benefits on their purchases such as one-day delivery, guaranteed cashbacks, easy flight bookings, etc.
- Value-based Program
This is one of the most creative loyalty programs in India. Here instead of giving points or rewards, the customers are made to become a part of a value-based initiative taken by the brand such as contributing towards girl child education, or feeding the homeless.
These gestures make a strong impression on the customer, making them remember your brand and get associated with it. Further, customers also refer the brand to their peers resulting in more brand loyalty and recognition.
- Cashbacks
This is one of the most commonly used customer loyalty program being implemented. Here customer loyalty is rewarded by giving them a certain amount of cashback on their purchase.
Loyalty program leaders such as RewardPort offer various different programs that can be implemented here such as Freebucks, Gamebucsk, etc.
Customer Loyalty Program Uplifting Businesses
Integrating customer loyalty programs in a business is one of the smartest decisions a brand can make, as this allows the brand to not only use this as a marketing strategy but also reward the loyal customers by making them feel valued, and let these loyal customers do the rest of marketing for the brand.
Using these loyalty program company are investing in a long term process and relationship between the brand and the customers that will help the brand to gain more customers and increase their sales & revenue as well.
Apart from this, customers these days don’t feel valued enough by the brand they tend to switch to a different brand, so a loyal customer will purchase a product from the brand they are loyal with even if the price is even a bit higher than others. Maintaining the customer loyalty program is a long-term investment that the brand is making today for its future.
RewardPort Customer Loyalty Program
Leading loyalty program providers such as RewardPort offer various different programs in the market to cater to the wide range of the clients and their needs. The programs by RewardPort are designed to cater to the different needs of different clients.
Some of the programs offered by RewardPort are CineRewards, Freebucks, Gamification, Scratch2Win, Sweepstakes. For more information get in touch with the experts here.
Frequently Asked Questions: -
Customer loyalty programs are integrated to recognize and reward the loyalty customers for their efforts and contributions toward the brand throughout the journey. It can be of different forms depending on the brand such as cashbacks, discount coupons, referral bonus, etc.
Customer loyalty programs allow brands to reward the loyal customers and it helps to retain the customer, increase their customer base and generate more leads as well.
Different rewards in loyalty programs include:
Cashbacks, discount coupons, point-based systems, vouchers, free memberships, official brand merchandise, etc.
7 Loyalty Program Rewards for Small & Medium Enterprises
More and more brands are now adopting the concept of loyalty program rewards to retain customers. Research shows that over 90% of companies, whether small, medium, or large enterprises, have a loyalty program today. Businesses must have effective strategies to boost customer retention and stand out in a competitive market.
Running a loyalty program is the most used and effective way to encourage customers to stay loyal to a particular brand.
Loyalty program rewards motivate customers to turn into repeat buyers. However, a loyalty program will work only if it aligns with the interests of the customers and the business. A loyalty rewards program that works for a large-sized business might not be suitable for other small brands.
Here are some best loyalty program ideas for small and medium enterprises:
1. Loyalty Points
Points-based programs are one of the most common loyalty programs for businesses of any size. Such loyalty programs aim to motivate customers to stay loyal to a brand. Under these programs, customers receive a few points every time they purchase.
The number of points is fixed against a certain amount spent on the brand. For example, you can offer 10 points on every spend of Rs. 100 to your customers. If they make a purchase worth Rs. 1,000, they receive 100 points.
These points can be redeemed against various options available at a rewards portal or in the form of store credit that is redeemable for future purchases. You must ensure that the loyalty points are valuable for your customers to make these loyalty programs successful.
If your rewards program is not interesting enough for your customers, it cannot encourage them to repeat purchases and stay loyal to your brand. When the loyalty points are valuable, your customers feel they are getting something in return for their spending and will be motivated to repurchase.
2. Referral Purchase Rewards
Referral purchase rewards are the rewards/benefits customers receive for referring a product to their friends. Under these programs, your referring customers and their friends (to whom they refer your products) get some benefits.
However, the terms and conditions for receiving the rewards can be different with different referral programs. Some programs offer rewards/discounts as soon as customers refer a friend. However, other programs reward them only when their friend signs up or makes a purchase.
The latter is a better option. You can run a referral purchase rewards program under which your customers receive decent benefits when their friend signs up to your website and makes a purchase. You can also keep different rewards for different levels in the referral process.
For example, your customers receive a certain number of reward points when they refer a friend, then they get a discount coupon when their friend signs up, and finally, they get a gift when their friend makes a purchase.
Referral programs are a great way to expand your market reach and acquire new customers. You can encourage your customers to make more and more people aware of your brand. The programs help you increase your brand awareness through word-of-mouth and boost sales.
3. First Access
Giving your customers the first access to your new products, flash sales, and discount offers is also an effective way to boost customer loyalty. Whenever a new product is launched, you can make it accessible to the registered customers on your website before it is available to others in the market.
Another way is to provide your customers early access to flash sales, discount offers, BOGO deals, etc., via e-mails or text messages.
With these loyalty program techniques, you can encourage your target audience to become your registered customers. Also, as your existing customers feel special when they get early access, they promote your brand through word-of-mouth.
The early access strategy works better for online businesses, where purchase does not require registration.
4. Charitable Activities
Giving back to society can be the best reward sometimes. Your rewards program can give your customers opportunities for charitable donations. Offer loyalty points to your customers for their purchases and let them redeem their earned rewards against charity.
Such programs can encourage socially conscious consumers to stick to your brand as they get to contribute to the charity through you. You can include different charity options in your reward redemption program and allow your customers to choose what they prefer.
Once they accumulate a certain number of loyalty points, the equivalent amount gets donated to charity in their name. The program becomes more effective when your charity partners are related to your brand.
5. Pay Later Accounts
Most top e-commerce companies provide ‘Buy Now Pay Later’ options in partnership with financial services companies. Pay Later is a small line of credit that allows customers to purchase and pay for it over a month or in installments.
The pay-later option makes it convenient for customers to make frequent purchases. Moreover, they often spend more than they would without this credit option.
By providing pay-later and EMI options to your customers, you can make them feel that you trust them and understand their needs. Customers with a line of credit with a brand are more likely to stay loyal to it.
6. Freebies
Who doesn’t like getting free products? One of the most effective ways to retain customers is by offering them freebies. Whenever your customer makes a purchase, surprise them with a random free product.
It can be anything as small as a free pair of matching earrings with the main outfit. If you have launched any new products, the best way to make your customers aware of them is to send them free samples along with their purchase.
You can also let the consumers redeem their loyalty points for a free product. The redemption options can include other brand vouchers, discount coupons, etc., to make the program more exciting. Using the word ‘free’ in your loyalty programs can be much more effective than it seems to be.
7. Limited Period Offers
Keep coming up with limited-period offers exclusively for your customers. When your customers make a purchase, you can provide them with a discount coupon that is only valid for a short period. Make the discount offer exciting enough to motivate your customers to visit your store back before the offer expires.
Offering great discounts for a limited duration creates a sense of urgency in your customers and prepone their purchases.
How To Build a Loyalty Program?
Almost every brand runs a loyalty program to retain customers today. However, the loyalty rewards program can be considered effective when it adds value both to the customers and the brand.
Here are some important points to consider when building a customer loyalty program for your business:
- The loyalty program must offer value to your customers. If the customers don’t find your loyalty program rewards valuable, they may not feel motivated to repurchase.
- Tie the rewards back to your brand to make the program more effective. You can offer rewards or cashback that the customers can redeem against your products.
- Keep a mix of instant and premium rewards for different segments of customers. Not every customer is loyal. Before offering premium rewards and benefits to boost loyalty, you can identify long-term customers and one-time buyers coming for discounts.
- Make sure that the rewards program is cost-effective for your business and that you don’t spend without analyzing the results.
Set up a Loyalty Program with RewardPort
RewardPort is one of the top loyalty program solution providers in India. With RewardPort, you can set up a loyalty program that works for your brand and fulfills your customer needs. Experts at RewardPort can plan and execute loyalty program strategies according to your business goals and consumer profile.
RewardPort helps you provide loyalty program rewards online and offline as your budget and consumers allow.
Frequently Asked Questions: -
Loyalty programs are the programs that businesses use to boost customer loyalty. Customers get some sort of reward every time they spend on a brand. These rewards can be in the form of loyalty points, cashback, or store credit. Customers can redeem the rewards against future purchases or other options from the brand.
Some most effective types of loyalty program rewards are store credit, loyalty points, rewards redeemable against charity, referral rewards, etc.
Some significant benefits of offering loyalty program rewards to customers include:
- Effective in customer retention
- Encourage customers to spend more
- Help you increase brand awareness through word of mouth
- Improve customer experience
Your Guide to Consumer Promotion for 2023
As the holiday season approaches, brands have a special chance to both take advantage of one-time offers and plan their strategy for the upcoming year. Every year brings new customer expectations and trends, so savvy business leaders will use a combination of tried-and-true techniques and cutting-edge data to meet both present and future customers.
It makes sense that one of the most crucial marketing processes is the promotion plan.
It promotes your marketing messages, engages your target audience, and helps you connect with them. Creating promotion techniques is essential if you want to increase traffic and conversions.
You’re going to learn how to market your company and how to create a consumer promotional strategy with practical marketing techniques. You will then have a better understanding of public relations, mobile marketing, digital advertising, and content promotion.
What is a Promotion Strategy?
A promotion strategy is a workable plan to spread the word about your company, bring in more revenue, and increase customer loyalty. It should ideally answer the following for you:
- How to carry out your marketing strategy?
- Who to target?
- How to communicate with your audience?
- How to execute your consumer promotion plan?
Each year, many marketers spend more on business advertising, yet they get less in return. You must ensure that your words are reaching the people you want to address when you promote your brand. It is easier to get muffled in the noise of the market unless you have a crystal-clear communication strategy.
Additionally, it is exceedingly challenging to turn prospects into consumers without using persuasive marketing messages that evoke strong emotions and spark interest in and desire for your products.
Role of Promotions
One of the four components of the marketing mix is a consumer promotion. It is a component of marketing communication that reaches your target market to raise awareness and encourage dialogue with potential customers. With the aid of promotion, you may attract the interest of your target audience, pique their need for your goods and services, and persuade them to purchase from you.
- Increase Awareness: Educate your target market about the goods and services you offer. Your target market, consumer promotional marketing messages, and outreach techniques must all be determined.
- Foster Pursuits: Gaining their support for your company. To display originality, and difference from rivals and provide adequate material for lead nurturing, a well-designed content marketing plan is necessary.
- Lodge Demands: Making your services and products appealing. You may engage your prospect emotionally by sharing appealing features and advantages.
- Encourage Potential Customers to Act: Placing a call-to-action that will enable your target audience to quickly engage and discover the next steps. Each location you can position to promote conversions, including your website, online advertising, and social media.
Additionally, it will support the development of a stronger bond and encourage returning customers to do business with you for a longer period.
Types of Promotional Activities
You can draw in potential customers through a variety of consumer promotional marketing strategies. The customer loyalty program, internet advertising, and traditional marketing like face-to-face selling.
- Selling in Person: A company’s sales representatives personally deliver their offer to you in a sales presentation. With you, it is simpler to develop relationships than it is with the other strategies.
- Conventional Marketing: To reach a larger audience, encourage immediate engagement, and boost sales, you can employ any paid adverts. It is one-to-one marketing, and the price is determined by the amount bid.
- Direct Selling: Through marketing platforms, it is direct communication with a carefully targeted audience. It has a greater probability of receiving prompt feedback and maintaining client relationships.
- Sales Promotion: To encourage purchase and conversion by performing a short-term marketing campaign will activate attention. You will surely get immediate responses.
- Public Relations: You can give the right information and manage both positive and negative client feedback to improve your company’s reputation and foster stronger customer relationships.
- Customer Loyalty Program: It encourages your present clients to buy more frequently from you and stay with you, which over time results in significant earnings for you.
Why is a Promotional Strategy is so Important?
One of the most vital marketing procedures is business advertising. It focuses on the best ways to draw in suitable clientele, effectively market your goods and services, and persuade customers to purchase them.
If you execute a strong consumer promotion campaign effectively, you can move prospects from the awareness stage into the action stage. It enables you to develop a lasting relationship with your target market and build strong brand recognition and lead generation.
Additionally, creating a consumer promotion strategy aid in the reduction of pointless promotion expenses. This is because you’ll market to the appropriate audience rather than just everybody out there. And they’ll start favouring you over the competition as they begin to recognize you more.
Benefits of Promotin Strategy
Your promotion will be guided by your marketing plan. Additionally, it will significantly affect how consumers make decisions.
The main advantages of a promotion plan are as follows:
- Increases brand recognition
- Entices new customers
- The ideal moment to publish your promotion is now.
- Boosts the flow of qualified customers
- Differentiates yourself from the competition
- Gives your customer extra value.
- Engages the people you want to reach
- Motivates consumer choice
- Look for prospective collaborations
- Build up your customer base
- Increases your reputation
- Boosts prospects for word-of-mouth referrals
- Maintain a market share advantage over the competitors
- Boosts profits and sales
Market Leader in Rewards & Consumer Promotion Strategies
For the marketing efforts of your business, RewardPort provides a wide range of programs, services, goods, and solutions.
Our capacity for customisation is RewardPort’s area of competence. We can create, carry out, and implement a solution that is unique to your business.
Frequently Asked Questions: -
A sales promotion program is aimed at achieving smaller business goals within short periods. It can be done by offering short-term discounts or other offers, such as a buy one gets one deal to boost sales during a particular period.
Gifts with purchases are offered by businesses to boost their sales by attracting more and more customers. The gift can be anything, such as loyalty points that can be used to reduce the cost of future purchases, cashback on the purchase, discounts, gift cards, or anything useful for the buyers.
To redeem a gift card from a particular brand, you will have to visit their official website or mobile app, find an option to redeem a gift card directly or use the gift card to avail discounts or offers on your purchase by applying the available code.
How IoT Will Influence Customer Loyalty Programs in Future!
One of the important sources of competitive advantages nowadays from a service provider point of view is customer loyalty. Many companies are investing in rewards and incentive programs to encourage customer loyalty. But given the ever-increasing competition, keeping customers loyal to your brand is no easy task. So how do brands build trust, drive engagement and create value for their most prized customers in today’s fast-paced world?
The Internet of Things (IoT) can help!
Today there are a multitude of objects and devices connected to the Internet of Things (IoT). The number of connected devices is expected to exceed 40 billion by 2024. Considering the proven value of Internet and such promising growth trends, it only makes sense to ride the wave of opportunities that the IoT will provide.
Let’s see how it works!
Innovate using IoT insights
Creating innovative experiences that remain true to the brand is one way to engage customers. We talk about virtual reality changing the landscape of customer engagement. Let’s see how it works. Virtual reality enables customers to ‘try before they buy’ products online. Now if brands tie this into their loyalty program, what will happen? Their loyal customers will have a richer experience when shopping with the brand, which will certainly move the graph upwards.
Create a new level of personalization
Internet technology can dramatically increase the ability of firms to serve and develop intimate relationships with their customers. Using analytics, brands can create an entirely customized rewards program based on individual customer preferences, history, location and more. Automated emails related to customer actions are a great way to do that.
Gain the necessary competitive advantage
In a rapidly changing competitive environment, skillful use of technology can really help you establish a niche for yourself. Let’s use the seemingly simple mobile as an example. Your customers are connected to their phones, so if you really want to differentiate yourself, use your loyalty program to go where they go most often. An example of this is Sephora’s targeting of those who use their beauty insider app. Their beauty insider app allows for a seamless omni-channel experience where one can browse online, check store selection and pick up in store, all while collecting points.
A word of caution!
The IoT experience is the most exciting technology of this decade. The use of IoT has given businesses the NEW opportunities to interact and engage with customers, as well as introduce never before realized revenue streams. Be mindful, however, of customer privacy. Remember, with IoT we are also dealing with huge amounts of personally identifiable information. IoT is all about data and insight. We must, therefore, ensure that effective consumer privacy protections are in place to protect individuals.
Above said and done, we believe that IoT has the power to change the face of loyalty programs. Given the growing use and acceptance, the loyalty program of the future will offer more relevant, personal and rewarding brand experiences.
Blockchain – Redefining the Future of Customer Loyalty Programs
Loyalty programs have slowly made their presence felt across travel, retail, financial services, and other business sectors. And since technology is progressive in nature, they are seeking for some kind of disruptive innovation that would turn them more consumer-friendly. Currently, companies are trying to implement new technologies that would suit their ever-growing needs. Blockchain is the next level innovation in this aspect and according to experts, it will bring the same change to banking what internet bought to media. Blockchain has become the first native digital currency for peer-to-peer value exchange.
It acts like a redemption for consumers since it provides them a single platform to access multiple loyalty programs. For example, imagine keeping only one wallet for all loyalty points and you don’t have to hunt for different options, limitations and redemption rules. Apart from that, there are a host of benefits for which Blockchain will redefine the future of all financial transactions in near future. Let’s explore.
1. It’s fast
The decentralized approach of blockchain diminishes the complications between buyer and merchant. Many stakeholders make e-commerce transactions unnecessarily complicated by involving parties that makes the process complicated by adding additional function and bureaucratic steps. Blockchain eliminates the need of a centralized authority, so the money can travel instantly in real-time.
2. It’s cheap
Blockchain reduces a lot of costs. All kinds of loyalty and financial transactions run through a lot of complex network of vendors, banks and payment processors. Blockchain removes all unnecessary third parties by allowing cheap and timeless peer-to-peer transactions. For any online transaction, a consumer ends up paying somewhere around 7% extra which can be minimized by switching to alternative mood of payments.
3. It’s Transparent
Transparency is one of the most salient features of Blockchain. Since it follows a distributed public ledger system, it’s possible to track every bit of information of a transaction. In e-commerce, marketplaces and brands usually keeps all information by themselves and charges the trader to pass them. Blockchain solves this issue by making all data visible and allows all involved parties to access data for free.
4. It’s secured
Blockchain uses certain security system which is decentralized and immutable in nature. In case of any kind of data loss, it can be traced back easily.
5. It’s easily accessible
Blockchain is digital in nature and by implementing it, a lot of additional costs can be minimized. By nature it’s less costly and has lots of potential to divert people’s minds to purchase and participate in global economy. And since it’s decentralized, the same loyalty points can be used for various purposes.
Blockchain is almost similar to the existing loyalty and transaction programs, except that it is cheaper and faster. In a country like India, it’s still early to declare it as the ultimate redemption for the existing loyalty programs since Indian government has not completely legalized it yet. But its transparent nature is a major step towards democratizing economy and bringing the power of economy back to people.
How loyalty is acting as a game changer in the e-commerce industry
The e-commerce industry has revolutionised the way consumers think and purchase items. People love to shop online for all the convenience and benefits e-shopping brings with it. Consumers can shop anytime and anywhere for everyday or luxe products, save fuel cost, avoid traffic jams, and bypass crowded payment queues. The list is just endless. On top of that, a good customer loyalty program — that is simple to access — keeps the customers motivated and hooked for a substantial period of time.
The old patterns of consumer behaviour do not hold true in today’s digital age. So a customer loyalty program, that is constantly evolving according to millenials’ demands and industry trends, is definitely the way to go. A successful loyalty program depends on how effectively the consumer data is studied. With the right approach and proper discipline, a set of new benefits excites customers to shop at a reasonable cost. The old benefits, that are no longer serving any purpose, are eliminated from the program.
A game-changing loyalty program not only leads to an increase in sales but also results in new customer acquisition and better reputation for the business. A better brand image is definitely a good sign for overall business operations.
According to studies, it is the idea of a reward that makes most customers happy. The idea of saving money only comes after that. Since any great loyalty brings with it new customers and ups the sales, it helps the brand to reduce marketing costs to a great extent. On top of that, existing customers are far more likely to buy from the same brand again and again. Therefore, to keep them loyal is far more handy than to target new customers. Also, since these customers are already familiar with the company’s products and services, they are more cost-effective to serve! Reduction in cost to company and honest feedback are the two things that a business can rely on their loyal consumer base for.
Although many e-retailers understand the concept of customer loyalty fully and how important it is, many of them are lacking in effort for a sustained loyalty program. So there seems to be a disconnection. Still others don’t keep an accurate tab on how these programs are performing, even after they have been set into motion. The idea is to recognise the prime market and construct a plan that makes new customers loyal and keeps the loyal ones excited and looking forward to the brand’s new products. This has also proven to be helpful in beating competitors — that serve the same products and services — thereby gaining an edge over them!
Common Pitfalls of Customer Loyalty Program Design
Customer loyalty plays a very important role in maintaining a long-term and successful business and requires a detailed understanding of human behavior and their desires. A well-designed loyalty program will help in customer acquisition, engagement, retention and increasing number of loyal guests who repeat purchase thereby boosting revenue. On the other hand, if the program is poorly designed and implemented, it can have a negative impact on the company’s success.
When marketers are designing or improving their loyalty programs they should avoid the following pitfalls:
Undefined business objectives:
Loyalty schemes are designed to help customers develop an emotional connection with the brand. It’s of prime importance to understand the business requirements and link it to the overall business objective and brand values. For a customer loyalty program to be really effective it is important to make customers a priority and keeping the communication consistent so that they can establish a connection with the brand and are offered something valuable.
Treating all customers as equal:
It’s extremely important to understand every consumer is unique. Each of them has a different buying behavior and understanding how consumers behave will help design a profitable loyalty program. High-value customers are very vital to your brand as they churn more value to the brand and are loyal. Hence, it is important to differentiate between customers and treat the high-value customers differently. A key to this is personalizing their reward system and gift them such that they feel special.
Complicated program design:
Customers crave a hassle-free rewards program during the entire process of joining a program and claiming rewards. A loyalty program is more as long as it is simple to use and is convenient for the customers. If too many steps are involved in the earning of points people won’t bother to claim their rewards as it’s too much effort. This will develop resentment among the customers even when the brand message says that they value their customers as they don’t give enough importance to a buyer’s time. A program will be successful provided the entire design of loyalty program is well- communicated and transparent in its approach.
Ignoring the data:
The fundamental to a lucrative loyalty program lies in understanding the data collected from consumers every time they shop, review and refer it to others. It’s vital that business collect all this data, analyze it thoroughly and then use this information to create tailor-made rewards for individuals.
Frequent changes or no improvement at all:
It’s inadvisable to keep changing the existing mechanics of a reward program too often. Letting a member have enough time to accumulate points and redeem benefits will help businesses gain their trust and establish a bond with them. If the window between the two is very narrow and the program does not give enough time to earn points and then be able to redeem before expiring, the customers won’t feel appreciated and they will be hesitant in promising the brand their loyalty.
Making redemption difficult:
Because of delays and inadequate fulfillment of rewards, some loyalty programs make it very arduous for members to redeem their points and corresponding benefits. This may lead to loss of interest in the program and give up on the brand. Hence, the redemption should be instantaneous and convenient with instant gratification.
Not rewarding every purchase:
Quite a few loyalty programs only reward members for some of the purchases they make and hence fail to motivate them to spend more and earn benefits. It is important to pay attention to rewarding the high- value customers because their purchase margins are high but it’s equally important to reward those at the bottom of the pyramid too. Giving a customized experience to all members at different levels of the pyramid will only prove fruitful to the brand.
By avoiding these common loyalty pitfalls, most of which occur in the program design stage, you can ensure a reasonable chance of launching a successful loyalty program well before you put your program on the market. Retailers need to understand what their customers want, bake in a compelling value proposition; segment your customers; and use data to build relationships and put them front and center when planning the program for optimal success.