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Wednesday, 26th May 2021 | Sales

4 winning strategies to make your loyalty program a success

Customer loyalty has taken a hit during the pandemic thanks to changing consumer buying behaviours. Here's how to encourage loyalty from your customers.

We’ve all heard about job loss, missed school, and the overtaxed health care system, but a surprising consequence of COVID-19 comes from the business sector. Pre-pandemic customer loyalty is all but a faint memory. According to a McKinsey & Company report, consumers around the world have changed their shopping practices during the crisis, including trying out new brands. The result? Changes in brand preference. The communications firm Ketchum found that nearly half (45%) of consumers surveyed changed their preference for at least one brand, and a majority (62%) anticipated that these shifts would be permanent. 

All this upheaval creates yet another challenge for Canadian small businesses, but planning—and a solid loyalty program—will encourage more devotion from your customers. If you’re looking for ways to incentivize your customers, you’ve come to the right place. Read on for four winning strategies to encourage customer loyalty.

What is a loyalty program?

If you’ve ever used a buy-ten-get-one-free card, a coupon, or referral link, you’ve taken part in a loyalty program. Simply put, these are incentives designed to attract and keep customers by offering something back in return for their patronage. Implemented properly, loyalty programs can not only attract new and repeat customers but also foster positive associations with your brand and even your staff. 

Like anything else in business, there are best practices for loyalty programs. These four strategies will help you design a winner. 

Loyalty program best practices

1. Make it simple to use

Your loyalty program will not work if it’s too complicated. Make sign-up easy (or non-existent). Avoid multi-step ideas that may cause customers to abandon the program. Be flexible to accommodate real-life situations. For example, if a customer has forgotten their loyalty card, issue them another and allow them to combine stamps for redemption. The simpler your loyalty program is to use, the better. 

2. Make it easy to redeem

Customers use loyalty programs for the rewards, so make sure they can easily redeem. Don’t make them jump through hoops. If they earn it, they deserve it. Simplify the process by asking for customer information upon sign-up, not when they want to redeem. Nothing turns a customer off like feeling they’ve been duped so make sure your redemption process has no nasty surprises. 

3. Have few to no restrictions

Don’t complicate your rewards program with too many restrictions. For example, if you have a points program, don’t limit what they can be used to redeem. This kind of “small print” will only erode the goodwill you’re trying to foster. 

4. Keep time to reward short

Your customers want to realize the benefits of your program as quickly as possible. Your program will never get off the ground if it takes too long for customers to be able to redeem. Make it easy for your loyal customers to start earning points right away and be reasonable about the amount a customer is required to spend or the number of times they have to visit before they have accumulated enough points for a reward.

A customer loyalty program can be the right strategy to bring customers back to your brand—and to attract new ones. These four simple best practices will guide you toward a program that works for you and your target market. 

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