Here we will mention the most popular major customer loyalty programs, which are special programs to provide rewards and discounts to former customers. There are different types of these programs, and each company adopts what suits it according to its goals and needs. Among the most famous of these programs:
1. Point programs
There are certain points that the customer gets in exchange for purchases made in a certain period, and they differ according to the value of the purchases. These points become a privilege, such as a discount coupon, a gift or reward, a special offer, or a purchase voucher. And the customer must see the importance of collecting these points in order to obtain the privilege, which is a large part of the success of customer loyalty programs in the first place.
Some businesses use paper cards or charts with customers to track purchase dates, determine the number of points, and then determine the discount or reward.
Here, you have to pay close attention to organizing the matter well so that customers do not get frustrated with unrealistic promises. You must be keen to build an enjoyable experience for the customer while dealing with your brand.
2. Membership programs
These are programs in which customers pay a monthly or annual subscription in exchange for a membership that gives them more special privileges that only members get.
The best example of a membership system in use is in recreational clubs. Obviously, anyone can go to any entertainment club and pay the cost of spending that day, but by subscribing to a membership, the member will always choose a specific club to spend his time in, because he is a member of it.He paid the subscription fee in advance.
3. Degree programs
Customers are divided into different segments, and each segment has a specific value for purchases, so that each customer enters the segment corresponding to the value of his purchases. Each segment has special privileges, and the greater the value of the purchases, the greater the value of the privileges.
There are also mixed loyalty programs, where a company mixes more than one loyalty program. There is also a program for the charitable side in particular, and some call it the value program, and it is related to donations to charitable activities or to the needy in exchange for each purchase from a customer.
Tips and important points to achieve the best results from customer loyalty programs
1. Encourage customers to take quick action by making the discount or reward valid for a certain period, compatible with your sales system and loyalty program.
2. Try to participate in local or national community services and link that to marketing campaigns. Some may just use this method to impress customers. But we advise you to try to do it for real; with the presence of the Internet, it is no longer easy for you to deceive consumers.
Furthermore, your genuine and honest community participation helps to build trust among customers, develop long-term relationships rather than just short-term sales, and avoid rumors about you.Some companies, for example, donate a portion of their profits to charitable organizations.
3. Before granting discounts, make sure that you study the market properly and know the rules for pricing products and services and granting discounts on them. in order not to put a discount on your product that makes the customer reduce the value of your product.
4. Ensure that employees are able to deal with customers well and give them adequate training, and that each employee understands the value of his role and its impact on customers and work.
5. Set an example of caring for employees. Don’t expect employees to care about work and customers without taking care of them first.
6. Participate with employees during your planning of a program to gain customer loyalty and provide service to them, and ask them for their ideas and opinions so that everyone can work towards one goal.
In the end, do not forget to ensure the ease of electronic systems for customers, as well as analyze customer data and update it constantly so that you can reach their needs and understand more about their changing behaviors.
The most important performance indicators for customer loyalty
As we mentioned earlier, there are hundreds of metrics for estimating the success of each department of business administration and its affiliated branches, as is the case with indicators of the success of the customer loyalty program.
Whereas there are hundreds of metrics to determine the feasibility of the company’s customer loyalty program, and the metrics and indicators differ depending on the needs and objectives of each company, you can at least be aware of the most well-known main indicators and modify them to suit your needs.Such as:
1. Acquisition
It includes two indicators:
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The number of qualified customers
This indicator is related to the beginning of the upper part of the customer conversion path and gaining their loyalty, in which we make sure to attract customers at the beginning of the first purchase stage so that they become eligible to join the customer loyalty program. This indicator is calculated by calculating the estimated number of customers who have actually seen the loyalty program and who know what the company offers in terms of offers and rewards.
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Conversion rate
Of course, there are many conversions that can be measured along a customer’s journey with a company, but in general, what matters most here is the number of people who say yes to a customer loyalty program and actually use it.
This indicator is calculated by dividing the number of those who used the loyalty program by the number of those who saw the offer and the program in the first place, i.e., the first part of the indicator.
This indicator provides a key measure of how people understand the offer and how interested they are in it. You can’t prove the value of your customer loyalty program if you can’t convince customers to sign up for it in the first place.
2. Customer Lifetime Value
It is the average profit that the company achieves from a single customer throughout the period of its dealings with him in the customer loyalty program, and it is calculated by calculating the average number of months that the customer spends in the program with the total monthly cost that the company bears for each member.
It also includes calculating the costs of reaching customers through advertisements and other means, so that we can arrive at an estimated value for calculating the cost of obtaining each customer’s loyalty over a specific time period.
3. Interaction
It is about calculating the average number of months that customers spend in the customer loyalty program and interact with it, so the longer they stay in the program, the more value they see, and the more it becomes possible to increase the duration and frequency of the program.
4. Average increase in purchases
In it, an estimated calculation of the increase in purchases is made after the application of the customer loyalty program and before its implementation to compare the increase in the percentage of purchases. In other words, the extent to which the customer loyalty program affects the increase in the rate of purchase from customers and the increase in sales is calculated.
In the end, we remind you that the basis for gaining customer loyalty is good planning, measuring your success with clear key performance indicators, and analyzing data and indicators.
The most important thing is to always remember that all indicators and labor management departments are linked to each other, and one cannot be isolated or separated from the other, and you cannot stop learning continuously until your company develops continuously as well.
Read also: What is customer loyalty and how do you gain it?
