Loyalty Schemes Vs Price Promotions — Which Is Better?
Customer loyalty programs have the biggest influence on customers switching brands, according to the exclusive research seen by Comarch Global Market Report 2022 [1]. However, when it comes to price promotions and discounts, they can also sway customers’ opinions.
What makes loyalty programs better?
A loyalty program often works better for acquiring loyal customers and increasing customer retention because of the psychographics behind the consumer. Consumers who use coupons simply jump from one deal to the next, rather than making a brand connection.
Discounting your product may get you more customers in the short term, but it’s seldom an effective strategy for developing regular, long-term customers. When business is slow, many businesses turn to discounts and coupons to attract customers.
Different Loyalty Programs
The loyalty program that works best for your small business depends on your customers and your products. The key is to remember that creating a better customer experience is more important than lowering the price of your product. We are in the Places App can help you to create the most resulting loyalty program.
Paid Program
With paid programs, customers must pay an upfront fee for a list of perks, like discounts, special events, etc. Paid programs can be difficult to sell unless your business is frequented enough for people to feel they will get their money back in discounts.
Tiered Program
In tiered programs, customers gradually work their way up tiers, gaining extra perks or status symbols. Tiered programs have been proven to be effective because certain VIP members end up receiving preferential treatment, which makes the members feel part of the brand, and motivates other customers to work their way up as well.
Points Program
It is easy to understand Loyalty Points Programs, mostly because of the simplicity of the concept. You buy a certain number of products and get one free or you get a discount. Restaurants, hotels and retailers all use Loyalty Points Programs to entice customers to use or buy their products often enough to get a freebie.
Community Program
Programs such as community programs enhance the customer experience by giving customers access to a social community. Members may have access to a community board or social event. This creates a community identity, which puts the brand at the core of the business. This is an effective loyalty program if the company has an engaged customer base.
Building a Loyalty Program
Here’s what you need to consider when building a loyalty program.
Integrate Your Marketing Strategy
A good loyalty program doubles as a marketing strategy. The best kind of loyalty program is what people want to talk about with their family and friends or share on social media, which leads to referrals and word-of-mouth marketing. Customers who are part of a customer loyalty program become repeat customers and brand loyal, increasing their lifetime value.
Enhance Customer Experience
Some businesses lower the price of their products to attract customers, but your customers’ experience is more valuable for retaining them. If your customers feel valued, are included in your brand and identify with it, that’s how you secure customers for life. The key is building an emotional connection between customers and your brand.
Integrate Tools
Using tools designed for loyalty programs can help you create a successful program. For example, a customer relationship management (CRM) tool allows you to document and easily access customer data for a seamless experience. Tools can save you time, help you to customize customer experiences, and help build customer loyalty. Such a tool for the restaurant industry is the Places App.
Focus on Convenience
For a customer loyalty program to be successful, convenience is key. Loyalty programs should make life easier and more fun, not more difficult. Programs that require you to carry and use a punch card can be a hassle for customers. Mobile apps, phone number linked accounts, and other systems are easy for customers to use.
How to create convenient loyalty programs
Loyalty programs are convenient and mobile. They have to have an app or some kind of system, so they don’t need a card in a wallet. Apps are so much easier because almost everybody has a phone. Customers can pull up the app and say “Okay, I’m here right now.” Making apps seamless is important, as it will make it easy for everyone to do business.
With the Places App, the guest experience is integrated with a loyalty system and much more. Get all your clients in one place, and promote your new meals, degustations, news and events. Scaling up the relationship between restaurants and customers. Become a partner.
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