Does your retail business have a loyalty program in place? If not, now is the time to launch one before the holiday shopping season reaches its peak.
A loyalty program can get first-time shoppers to come back again and again for holiday shopping — and long after the gifts are unwrapped. With more traffic in your store, the holiday season is the perfect time to grow your loyalty program membership.
Loyalty programs have many benefits for retailers—and are highly popular with customers. According to the 2017 Holiday Retail Outlook, 76 percent of consumers belong to a loyalty/rewards program, and 72 percent say a loyalty program makes them more likely to shop at a specific retailer. Follow these steps to start your loyalty program.
1. Know what your customers want. What attracts customers to a loyalty program? According to the Holiday Retail Outlook, these are the most desirable features:
Earning rewards for my purchases — 88 percent
Receiving special services — 32 percent
Ability to use rewards for experiences — 14 percent
Having a mobile app to store membership info — 12 percent
Being recognized with a higher status — 8 percent
Before choosing a loyalty program, it’s a good idea to survey your customers and see what rewards they want most.
2. Make it worth their while. You can handle loyalty rewards in a variety of ways. For example, you can give points redeemable for rewards; give customers cash back on purchases; or offer “tiered” rewards where perks get better the more shoppers spend. You can also mix it up by offering all of the above. Whatever system you choose, at this time of year shoppers should be able to earn meaningful rewards quickly. More than half (59 percent) of consumers use loyalty program rewards to do their holiday shopping, so the faster they can earn rewards, the more shopping they’ll do in your store. (Be sure the rewards are helping, not hurting, your profit margins).
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3. Decide what you want. Many retail loyalty programs can also track shopper behavior and help you market to individuals based on their past purchases and other information. What are your goals for the loyalty program? What is your budget? What loyalty/rewards programs do your competitors offer? What kind of data do you want to collect about your customers and how do you want to use it?
4. Assess your options. Popular loyalty programs include Belly, FiveStars and Perka. Look for a loyalty program that is tailored for small retailers and meets both your and your customers’ needs. Be sure to ask about setup fees as well as monthly costs. Also take into account how easy the program is to use—both for your employees and your customers. For example, some customers may still prefer loyalty programs that offer plastic loyalty cards, not just mobile apps. Finally, with holiday season rapidly approaching, you’ll need a program you can get up and running fast.
5. Spread the word. Aggressive marketing is key to the success of a loyalty program. Promote your program in your holiday advertising, on your website, on social media and with signage in your store. Employees should educate customers about the benefits of the loyalty program and encourage them to sign up. Make it as simple as possible to join the program—no one wants to hold up the whole line of customers while they fill out a lengthy form. As you attract more loyalty program customers, you can even offer them rewards for getting others to sign up or spreading the word on social media.
Once the holiday shopping season ends, don’t let your loyalty program marketing lag. Keep signing up new members and creating new rewards. Do it right, and a loyalty program can be the holiday gift that keeps on giving.
About Rieva Lesonsky
Rieva Lesonsky is CEO and Co-founder of GrowBiz Media, a custom content and media company focusing on small business and entrepreneurship, and the blog SmallBizDaily.com. A nationally known speaker and authority on entrepreneurship, Rieva has been covering America’s entrepreneurs for more than 30 years. Before co-founding GrowBiz Media, Lesonsky was the long-time Editorial Director of Entrepreneur Magazine. Lesonsky has appeared on hundreds of radio shows and numerous local and national television programs, including the Today Show, Good Morning America, CNN, The Martha Stewart Show and Oprah.
Lesonsky regularly writes about small business for numerous websites and for corporations targeting entrepreneurs. Many organizations have recognized Lesonsky for her tireless devotion to helping entrepreneurs. She served on the Small Business Administration’s National Advisory Council for six years, was honored by the SBA as a Small Business Media Advocate and a Woman in Business Advocate, and received the prestigious Lou Campanelli award from SCORE. She is a long-time member of the Business Journalists Hall of Fame.
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