Would you like your business to be 88% more profitable than your competitors? According to an article in Retailing Today (http://retailingtoday.com/article/loyalty-programs-one-hottest-trends-retailers-2013) a couple of years ago, all you needed to do was to implement a loyalty program and you would magically be more profitable than you were before. If that seems to be too good to be true, then maybe it is.
It is true however that loyal customers are more profitable than customers who shop once and never return. The key is to turn a shop-and-never-return customer into a loyal, return-often-and-spend-a-lot-of-money customer. Obvious but not easy so here are a few tips:
- Implement a loyalty program.
This is not the end all and be all but it is an important part of creating loyal customers. It is important to give the customer a way to measure their loyalty. As Edward Deming, the father of modern quality once said: “ You can’t improve what you don’t measure.” In addition, it has been proven time after time that loyalty points have the psychological impact of getting something for nothing so they are a powerful motivator.
We will provide more information on various types of loyalty programs in a subsequent post.
- Provide more value than your competitors
To many this seems to be just another way to say “Lower your prices”. However this is not what we mean by providing greater value. In this day and age of instant information many things have become more confusing, not less. There are so many solution and product choices with so many different features and characteristics that it is hard to make a choice. In addition, many products have become much more technical, from clothing to power tools that it is difficult to know which features are the best for your application.
One clear way for a company to add value is to hold seminars, classes and product demonstrations. Event based marketing is a key to providing more value to your customers. We will talk a lot more about events in subsequent posts.
- Make customers feel special
People love to be treated with special care. Businesses can do this by providing member only deals to customers who are willing to “join” their club. Joining is the first step because it helps you to identify who your customers actually are, which is the first step. In many businesses customers come and go without ever having to identify themselves. While this makes the transaction faster, it does not give a business a way to reach out in a personal way to that customer ever again. The key is to provide a fast easy way for a customer to voluntarily join your business’ group.
All of these topics will be discussed in a subsequent post on event driven marketing as well as the best methods for getting customers to join your loyalty or other member-based program.