According to Forbes, a whopping 80 percent of small businesses survive past their first year. Unfortunately, once the five-year mark hits, this number falls to around 50 percent. If your small business struggling, or you simply want a way to keep your current customers happy and create positive buzz about your company, a loyalty program is a great option.
Here are a few of the many reasons why your small business would benefit from a customer loyalty program.
Loyalty Programs Help You Stay Competitive
If you're a struggling small business surrounded by other small businesses or massive department stores that offer similar goods or services, lowering your prices or offering a better customer experience are two strategies to help you succeed. Unfortunately, if it's not financially feasible for you to lower prices or make over your office space or storefront, a customer loyalty program is a great option.
There are several customer loyal programs to consider, and you might be surprised at how inexpensive it is to start and maintain your program.
Loyalty Programs Help Retain Customers
For small businesses with a modest marketing budget, a customer loyalty program can help them retain their current customers and attract new customers through positive reviews and word of mouth. Your customers will appreciate the extra incentives that come with a customer loyalty plan, such as a discount after so many visits or free merchandise or other perks.
Repeat customers who maintain a personal relationship with small business owners often spend more money than a new customer as well.
A happy customer will brag about the swag they acquired from participating in your loyalty program, and their friends and family will take notice. When compared to the cost of marketing your small business, the minimal cost of starting a customer loyalty program will make even more sense.
Loyalty Programs Help You Get to Know Your Customers
Hiring a market research company is a great way to learn more about your customers' likes and dislikes, which can help you keep your current customers happy. If you don't have the funds for professional market research, a customer loyalty program can provide you with similar information about your patrons.
Monitor the reactions of your customers to various loyalty programs and rewards. You will quickly discover which rewards excite them and which aren't as attractive. This can help you tweak your loyalty program rewards, and the products or promotions to which they're attached to suit your customer's preferences.
Types of Customer Loyalty Programs to Consider
There are loyalty reward programs to fit any small business owner's preferences and budgets, including:
Points system. Customers earn points for each purchase. The points are accumulated and redeemed for merchandise or percentage off a future purchase.
Punch card. Provide the customer with a punch card and each time they make a purchase or spend a certain amount, they receive one punch. After a certain number of punches, the customer is rewarded with a free product or discount.
Gift card program. Reward the customer for spending a certain amount in a single year or for their birthday by offering them an in-store gift card.
Loyalty card. After the customer registers, they use their loyalty card each time they make a purchase. The loyalty card rewards the customer after a certain number of visits and can be used to track the customer's previous purchases.
Include other incentives to customers who register for a customer loyalty card. For example, you could give them a gift or discount on their birthday.
Customer loyalty programs are an easy and inexpensive way to retain your current customers, attract new business, and help your small business remain competitive. Get in touch with a customer loyalty program company to learn more.