Let’s start with a simple question:

Why should a small, local company need a loyalty program to reward its faithful clients? I mean, doesn’t the owner of a small business already know which customers are loyal and keep coming back? Is there really any need to take any more of an interest in them? That’s an easy question: the answer is a resounding “yes!”. Why? Because it’s the loyal customers who can significantly increase a business’s turnover and sales.


Let’s start from the beginning. The owners of most small and medium-sized enterprises tend to focus their efforts on acquiring new customers, expending time, effort and often money on finding the best channels and messages for attracting them.


Which means that, more often than not, they seldom think about ways to keep their existing customers. They wouldn’t do this if they knew that it’s far more expensive to get a new customer than it is to keep one they already have.


In fact, it may cost a small business up to seven times more to win over a new customer than to keep an old client satisfied.


If you still aren’t convinced, the statistics show that your existing customers can spend up to 67% more money with your business than a new client.


And one last thing. Younger consumer groups are far more likely to seek out businesses that reward them. In fact, 68% say they wouldn’t remain loyal to a company that didn’t have a good loyalty program.

What is customer loyalty?

There’s nothing new about customer loyalty or satisfaction programs. They’ve been around for decades and have been used in one way or another by everything from small neighborhood stores to chains and large companies.


Loyalty is a customer’s lasting preference for one brand or store over its competitors. In other words, it is the customer’s desire to keep on shopping from you and not your rival.


Loyalty programs are the way in which the company or store chooses to reward such loyal customers. And while some may believe that loyalty of this sort can be assured by quality products or excellent customer service, the sad fact is that these just aren’t enough.

“Keeping your customers loyal and satisfied requires time and a budget. It is not a race of speed, but a race of endurance.”

Rewarding your customers keeps them loyal. Because the more they come back to you to shop, the more often they opt for you and your brand, the more rewards they will earn and the higher your sales—and by extension your profits—will climb.

Why does a business need a loyalty program?

Loyalty programs are a win-win relationship, because both the company and their client benefit from them. Running a loyalty program means building long-term relationships with your existing customers; it also means standing out from the competition and boosting your brand recognition. Because in local markets especially, which run on word-of-mouth recommendations, it’s easy to create fans who can go on to recommend you to potential new customers. And if you think that programs of this sort are costly and that you just can’t afford them, that simply isn’t the case. With the help of technology, you can create loyalty programs that aren’t particularly expensive to run, and which are tailored to your business objectives.


Because, just as you need to actively invest in relationships of every sort to keep them alive, so keeping your customers loyal and satisfied requires both time and a budget.


Because business isn’t a sprint, it’s a marathon.

How effective are loyalty programs?

Loyalty program fail from time to time, and companies often abandon them, either because of the cost or because the programs aren’t achieving the results they want. Of course, like everything else relating to marketing and communication, program of this sort need to be continually monitored and evaluated.


If your customers find the rewards your program offers to be unsatisfactory, or the procedure for redeeming those rewards to be overly complex, they will quickly abandon it. What’s more, it is unlikely they will remain your clients for much longer. If they decide that you’re asking a lot of them and not offering enough in return, then you risk losing them and seeing your sales fall and, in the long term, your store’s reputation suffer. What ultimately makes or breaks a loyalty program is how successful it is at convincing your customers that it’s worth their while to participate in it. And if you want to have a winner on your hands, you will need to have designed a program which your regular and loyal customers will find hard to resist.


However high-quality your products are, however friendly the service you offer or cost-effective your pricing policy, with a generous loyalty program you won’t only have satisfied your existing customers, you will also have a much better chance of winning new customers you would have found it hard to attract in any other way.

Get in touch and we can go over some ways in which you can design a successful loyalty program tailored to your business and your goals.
With our expertise in customer satisfaction strategies and long experience in designing and implementing loyalty programs, we can help you keep your existing customers, acquire new ones and, most importantly of all, keep them all satisfied and loyal.

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