While they may still be relatively new, customer loyalty program certainly are not new. In fact, many have been around for decades. Still, most fall into one of the following four categories: reward programs, tiers, social networking, and compensated programs. That s why now some retailers are trying to shake things up a bit and discover new ways to develop new and encourage customer loyalty. Here’s an overview of some of the latest ideas from retail and other industries which have found new life through recent innovation:
Restaurant loyalty program:
One strategy being utilized by some restaurants is offering a discount or cashback incentive on all purchases made in their establishment. The reasoning behind this is that customers tend to enjoy buying in bulk, thus making it easier for them to earn some money back. This program works well in any category, but especially well with the younger consumer. Many kids (and not so many yet) love to collect stamps and really enjoy getting something back for each purchase.
Hotel loyalty program:
Another industry which has seen quite a bit of growth recently in terms of loyalty programs is the hotel industry. Some hotels have started offering discounts or free trips to certain destinations every time that a specific number of hotel guests are booked. This offers the potential for repeat business over again. However, the pros and cons of loyalty programs for hotels and the overall idea should be examined closely.
One of the best examples of a hotel loyalty program is the One World One program launched by W Hotel Worldwide a few years back. Here, a discount code was issued to all of the stores, restaurants, spas, and other participating properties for each booking made in the program. Loyalty program members were then only entitled to the discount if they made at least five rooms or stayed for at least seven nights. These two elements are important because it gives customers a reason to stick with a particular retailer and it also increases the retailer’s brand awareness to a larger extent.
It has been shown that retail loyalty programs have a positive effect on customer retention. The reason for this is because they offer a way for a customer to keep their money locked in one place. This also offers a customer the opportunity to buy in bulk. Retailers that have loyalty programs also tend to have a higher turnover rate since people tend to buy from the place where they have had similar experiences in the past.
Merchandise returns are another way that a loyalty program can increase customer retention. Most retailers offer rewards programs once a customer makes a purchase, such as cash back or credit towards future purchases. When customers return merchandise, they are offered either a discount or a coupon for their trouble. Both of these incentives increase customer lifetime value (LTV), which is basically the amount of money that a customer stays with a business because they feel that they are getting something out of it.
Many businesses also use loyalty program as a way to motivate existing customers to buy more from them in the future. The best marketing strategies help to convince customers that they need what a brand is offering. For example, if a business sells shoes, it would not make sense to give a discount to a person who only purchases one pair of shoes every week. The best marketing strategy would be to give a discount to people who purchase a minimum of three pairs of shoes per week.
A loyalty program, when used effectively, can have a significant positive impact on your company’s bottom line. However, it should not be the only marketing tool that you use. Your company should also develop other marketing tools such as advertisements, the internet, and loyalty cards. All of these tools will help to increase the amount of new customers and retain current customers. The right combination of a loyalty program, promotional tools, and customer contact can increase your profits while keeping costs down.