Companies who see the value of retaining their most valuable and profitable customers double down on loyalty. Why? According to reports, only 3% of new visitors come back again to purchase, this is alarming considering you spend so much acquiring them in the first place. Investing in customer retention simply pays off. Customer loyalty is a proven method to grow and sustain market share. Retention is one of the most effective ways to increase incremental revenue and gross profit margins because loyal customers spend almost 67% more than existing ones. Consider these stats:
- 71% of consumers who are members of loyalty programs say membership is a meaningful part of their relationships with brands
- 77% of consumers say loyalty programs make them more likely to stay with brands
So, how can you be sure to find the “right” loyalty program for your brand? It’s important to evaluate a loyalty partner who is the best for your company. A loyalty partner should have a fundamental understanding of who your customers are, how they shop and the overall customer journey. What you can’t have is a loyalty partner who does not have a clear strategy for you to achieve success. There are many loyalty programs that are low cost transactional tools which should be avoided as they don’t typically scale and are ineffective at retaining your most valuable customers.
Here are some questions that you must ask before hiring a loyalty partner and implementing your loyalty program:
- How simplified is the sign up process? – The main objective of having a loyalty program in the first place is to get customers to sign up. Hence the journey for them needs to be seamless and simple. The sign up process should be tailored to your brand and easy for customers to complete. Make sure this process is frictionless. Your loyalty partner should be using proven best practices.
- How good are you at personalization? – Successful loyalty programs are experiential by design and can be segmented and personalized. In order to remain competitive, your business needs to stay relevant on and on trend. You need to be agile and shift according to your customers needs and preferences. Your loyalty solution should be able to offer personalized emails and tiered rewards based on actual purchase history. According to research, personalization and customer satisfaction go hand in hand. 79% of customers surveyed agreed that they are very satisfied with loyalty programs with high personalization and that loyalty programs that make customers feel special and recognized had 2.7 times more satisfied members. Not just that, customers are also willing to share data to get personalized experiences.
- How customizable is your platform? – Make sure the loyalty program offers maximum flexibility so you can evolve as your customers evolve. Your loyalty partner platform should be differentiated and provide for unique reward experiences for customers. When it comes to loyalty, customization is key.
- What kind of marketing support can you provide? – A loyalty program will not sell itself and you need a loyalty partner who can provide you with a strategic marketing plan based on best practices and proven success. What kind of marketing strategy support does the partner offer, and is it in accordance with how your customers prefer to consume their information? Is it just emails, or are there printed materials, social media support and/or customer contact support? Get insights on these as well.
- Are we one of your priority clients? – Of course you want your business to be in good hands, so, you may want to align yourself with a loyalty partner that works with similar sized businesses and offers you hands-on service whenever you need. Your loyalty partner should dedicate a customer success manager to ensure your success.
- How much experience does the partner have in the loyalty space? – An experienced loyalty partner not only has the best-in-class platform but also brings with them vast experience in implementing loyalty programs across many different technologies. Make sure you are working with a loyalty partner who has experience working with many different clients across many different verticals.