How do you keep your existing customers? Have you done customer loyalty programs for your loyal customers? There is so much emphasis today on getting new clients that many small business owners forget about the profit potential of their current ones.
Those who’ve already bought from you are the easiest to sell to. For one thing, they are proven buyers. And when their first transaction was a good experience, your current customers are going to trust you. They are more likely to make repeat purchases. Also, it’s often cheaper to sell to them because they already have a connection with you and are in your contact info.
So, without doubt, sustaining your current customers is one of the most important things you can do for your business. And one of the best ways to do this is to have a customer loyalty program. Here are three tips you can implement to have an effective loyalty rewards program.
3 Tips For Creating Effective Customer Loyalty Programs
1. Give rewards cards
These will provide points for everything the customer buys. The more points they accumulate, the more things they can buy. Usually the more money you spend, the more cash back you get. Credit cards companies often offer this loyalty rewards program.
However, everyday businesses can do this as well. As soon as a customer buys something, you can immediately give them cash towards their next purchase. The more they spend, the more money they get for the next purchase.
Obviously you want to offer more points for the products with the biggest profit margins. These are the ones you want to encourage people to buy the most of. If you offer too many points for low profit margin products, you might end up losing money.
2. Offer rewards for referrals
This is an incredibly powerful strategy. This is because what your customer says about you always carries more weight than what you say.
So why not give them a gift card for every new customer that signs up? In order to do this right, you need to know how much your average customer is worth to you. This will help you set a maximum dollar amount you can offer.
For example, if you know each customer is worth roughly $200 over their lifespan, you can safely offer anything $200 as a reward. This strategy alone can seriously build your business.
3. Have a newsletter
Make sure to include coupons or a cash incentive to encourage people to sign up. Newsletters are a great way to stay in contact with customers and get that next sale.
No matter what strategy you use, you want to get that next sale in a hurry. The sooner somebody buys from you a second time, the more likely you are to have a customer for life.
The longer you wait, the more likely it is they will find another company to do business with. When you implement these three customer loyalty programs, you will give yourself a great chance of keeping your customers for life.