Acquiring or retaining?

What costs more?

According to research, acquiring itself, costs 500% more than retaining a customer. On the other hand, an existing customer spends 67% more than a new customer. So, in short, customer loyalty is a necessary advantage that pays off in the long run.

For a business to grow faster, having a loyalty reward programme is essential. It helps expand the business faster than sales and marketing. Through a loyalty programme, the company can attract and retain happy customers.

Cultivating customer loyalty is paramount and would ultimately pay off in different ways. It would impact in almost all metrics which is important in running a business.

Why is it important?

A business will not survive with unhappy customers who continuously buy company products. Loyal customers spend and convert more by spreading the word to their friends, family and colleagues, which also drives free referral.

This is explained best through the ‘old leaky bucket’ metaphor. Consider the business as the bucket of the metaphor. A successful business is like a bucket full of water, the customers pooling in and filling the bucket.

However, imagine the bucket has a hole at the bottom. Customers now flowing in, start leaking out. Now, however hard the business may try to fill the ‘bucket’, it would be a waste of time and effort. So, the only remedy the company has is to patch up the ‘hole’ and stop losing customers.

Some of the interesting facts about customer loyalty are as follows:

● The biggest problem for more than half of the retail sites, is customer retention. Therefore, retailers are more interested in loyalty programmes.

● This is because, increase in customer loyalty could increase the average profit per customer

● In the customers’ point of view, most of the customers join loyalty programmes to save money, whereas, some of the customers join loyalty programmes to receive special rewards reserved only for them.

● On the other hand, the customers themselves can agree, that they have spent more money after having a loyalty programme

With the right initiative we can convert a onetime buyer to a loyal customer and can help keep the brand at the top of one’s mind. Many companies use many different strategies to drive sales, increase retention and to build a strong relationship with customers. Some, such programmes are as follows:

● The Point Programme

This is a programme which is based on a simple principal: spend more and earn more points in return. Ex: The North Face

● The Paid Programme

This is a programme where the customers are invited to pay an annual fee to join the VIP customers. Ex: Barnes & Noble

● The Charity Programme

This is a programme that doesn’t include discounts but includes business values to create a strong relationship with the customers. Body Shop, is an example for an organization that uses this method of loyalty programmes.

● The Tier Programme

The tier programme is based on the customers loyalty. Ex: I.f is providing this kind of loyalty program.

● The Partner Programmes

These are loyalty programmes that partner with other businesses in order to provide more opportunities to customers who seek greater flexibility. Ex: Nike

● The Community Programmes

This kind of program provides their members with exclusive access to the communities of likeminded people, where the members can connect with each other and signup for inspirational events as well. Ex: Sephora

● The Subscription Programme

This is a modern-day innovation for the loyalty program where they offer you product based on subscription rather than the traditional programmes, which offer rewards and benefits.

Turning a customer in to a brand loyalist is not an easy task. But with the right strategy we can incentivize the customers to buy over and over again.

We, ShoutOUT has taken serious note about customer loyalty where we reward the customers with points for meaningful and profitable actions such as purchases, referrals, birthdays, sign ups, social media shares and anything that can be tracked. The points collected by the customers can be redeemed, not just through purchases but also in different ways such as free shipping, cashbacks, free products and third party product rewards.

Out of all the ShoutOUTs products, one main product is customer loyalty management platforms. Here we provide our customers with different solutions to overcome the challenges they face in managing their customer relationships. There are ample instances where ShoutOUT has catered to their customers. Some such instances are as follows:

DSI to connect with their customers, not with agents

One of our pioneer customers is DSI tyres, who has come a long way to establish themselves as the market leader by a wide margin. By being in business for more than three decades, they have built a broad customer base across the nation.

Developing a loyalty platform to include this diverse clientele as part of their customer retention initiative was a big bottleneck for DSI tyres.

They operated through third party vendors, and there was no direct relationship with their end users. The main method of communication with the customer base was through postcards, but it was costly and time consuming.

For this, ShoutOUT came up with an end to end loyalty platform that automated the process of gathering customer data, through incoming SMS and providing instant digital rewards for being a part of the loyalty program, making it simple and cost effective to DSI. Through this, the customers can sign up to the loyalty programme where they could earn points by sending a text message with the unique code that comes with the tyre. For these points they provide cash back rewards with mobile recharges and bill settlements. Moreover, customers can refer to their friends and earn more points which they can be redeemed for rewards of their choice.

Shirohana’s path for digitizing their loyalty platform

Another instance where ShoutOUT developed such a platform, was for Shirohana, a company which started its operations in an era that was missing quality greenhouse-grown flowers and chic flower shops.

By building new trends in the market, Shirohana became largely successful in its long run with a wide customer base. They then, wanted to introduce a loyalty system in order to provide more value to their points, rather than simply letting customers redeem the points against the bill.

Furthermore, ShoutOUT developed a tier-based loyalty program for Shirohana, where customers earn points that give them access to additional services and third-party offers allocated to the specific tier, they are in. What made this platform even more interesting is, the more the customers interact with the brand, the more points they earn, eventually resulting in them upgrading in to the next tier with larger benefits. Through this platform, ShoutOUT facilitated Shirohana to rapidly grow.

We, in ShoutOUT, have provided many more solutions and helped our customers’ in many different ways. The above are a few of such examples.

As communities progress, individuals tend to keep things organized. Having a consistent system in place ensures fairness and keeps customers satisfied over time.

This is where customer loyalty programs come in handy.

For further information about build winning relationships with your customers, shout out us at — https://getshoutout.com/

Shout out at — https://arimaclanka.com/