Surveys have been conducted in recent times to prove that retention marketing is more effective than acquisition marketing. For those that do not understand the concept of retention marketing, it involves creatively using loyalty rewards to keep your customers happy and encouraging repeat business. 70% of companies say it is cheaper to retain an existing customer than acquire a new one. 49% of companies claim to achieve better ROI in relationship marketing in comparison to acquisition marketing. (Source: Socialtimes)
Given this numerical picture, it is important for companies to heed the advice of their peers and look for creative ways to retain the customers they already have. One of such ways is by rewarding them. In these tough economic times, customers are looking for ways to reduce their expenses. Their first step will be to evaluate the usefulness of a brand to them beyond the product or service. If they do not feel a personal attachment to the brand, guess who would be first on the list to get eliminated?
Before embarking on a loyalty rewards program or campaign to deploy, companies must first analyze the current state within the company. Are your customers dropping off like flies or are they upgrading their products and services within your system? The initial assessment need to be done before deploying the loyalty program.
Here are four Loyalty Rewards that your customers would appreciate;
Reward Referrals – Reward your customers for referring other customers. This could be done using a point system or actual physical rewards for a significant number of clients referred. This helps your company reduce it’s acquisition cost as customers these days trust word of mouth before your marketing piece.
Point Cards – Point cards are creative loyalty rewards tools because they encourage repeat business and is flexible with the definition of rewards you can provide your customer. For example, if your company decides after receiving 10,000 points, your customer can get a free gift or a certain amount of money off their purchases, they are more likely to buy more to make up those points. The more they buy to make up the points, the more sales your company has.
Partnership – Partnership with some stores where your product is stocked or other businesses that offer parallel services can help boost your brand and retain customers. Your points card can offer you insights into what other products your customers purchase and if they are parallel businesses, you can consider partnering with them to offer rewards to your customers.
Gamify your rewards – Games are always fun regardless of the age of your target audience. Implementing country and age appropriate games for the target market helps increase brand awareness but also rewards your customers and retains them. Gamifying your rewards also increases the virality of your campaign so whether or not people are initially participating, they will hear about it and be curious enough to participate. This also reduces your customer acquisition cost and kills many birds with one stone.
For each campaign you run, measure the new customer retention rate once the campaign is over. The most accurate results are three months after the campaign to measure who stayed back after the frenzy. Measure how many customers acquired more products or services within your offerings also. That depicts the success of the campaigns you have run.
We at Sproxil have helped clients run very effective loyalty rewards campaigns with great success. Our loyalty rewards product is called Sproxil Champion which is a flexible point-of-sale consumer rewards solution with built-in fraud protection that empowers brands to offer consumers convenient opportunities to earn and redeem gratifying rewards from the brands they desire.
What creative loyalty rewards strategies have you deployed in the past? We would like to hear from you. Leave a comment.
