In today’s economy, it is prudent for merchants to place as much importance on customer retention as on acquisition. It is common business knowledge that it costs 3-5 times more to acquire a new customer than it does to maintain an existing one. So what is being done to retain customers?
Among the most successful customer retention strategies in recent years are loyalty programs. Across the country, airlines (frequent flyer miles) and grocery stores (VIP cards) have taken great advantage of rewards programs. As for the locals, who hasn’t had a punch card from the neighborhood sandwich shop in their wallet or purse?
While promoting the same concept, these examples are quite different. The loyalty programs of airlines and supermarkets distribute rewards and capture customer information. The sandwich shop program only distributes rewards. It does not collect any information to further benefit the consumer or their business.
Tip No. # 1: When planning your customer loyalty program, I suggest you avoid traditional (punched) cards. Instead, opt for a mobile system. Technology is current, popular with consumers, and provides you with a very effective communication tool.
Don’t confuse communication with consumers through your cell phone with spam! Customers “opt in” to participate and have the option to “opt out” at any time.
According to Nielsen ratings, more than 90% of the population 13 and older carry a mobile phone. Of these, more than 90% carry their mobile phone with them 24 hours a day.
Your advantage: text messaging has the fastest read rate at 90% in 15 minutes with a final open rate of 97% (email offers a high median open rate of 17% in 48 hours). No other system offers you a more powerful way to interact with your customers!
When looking for mobile loyalty programs, select a system that uses your customers’ mobile phones and email addresses for data collection, so it doesn’t disrupt your business flow. The program should consist of a self-registration station or allow customers to provide only their mobile phone number or email address to the employee at checkout, who then enters it at the Point of Sale terminal. The system itself should collect any additional information (such as birthdays, anniversary, etc.) outside the checkout line so that it is fast enough even for quick service restaurants to implement.
Tip No. # 2: Your mobile loyalty program must communicate with consumers through text messages and email. Since the information is collected by text message and email, the program should automatically attach customer addresses to its consumer base listings. You can then send them text messages and emails at any time using a web-based program.
Don’t misuse text messages and mass emails or your customers will quickly “opt out” of the program. Any communication should be beneficial to your customers and should not exceed 3 or 4 messages per month.
Your advantage: Texting is personal and allows instant two-way communication. You are establishing a profitable relationship with your customer!
Tip No. 3: Your schedule should be fully automatic. During customer check-out, you should only need a mobile phone number or email address to issue credits and distribute rewards (and never interrupt the flow of business). Additionally, your program should automatically distribute birthday and anniversary promotions as well.
Almost all mobile services measure coupon redemption / email open rates and offer extensive reporting capabilities so you can modify your schedule to maximize bottom line results.
Now, those are essentially all the features included with mobile loyalty programs. Of course you don’t want to be Ordinary! Your program must be better than average, unique. Learn about additional features.
For example, there is a mobile customer loyalty provider (the only one I know of) that is fully integrated into Facebook. That makes the subscribed companies’ service unique from its competitors and allows Facebook users to sign up with just one click to complete enrollment. The program then posts relevant notices on customers’ walls and makes exclusive offers to their friends by following the hyperlinks. The viral nature of Facebook itself makes this a great way to build a loyalty program.
Another example of additional features is the ability to transmit voice transmissions, if preferred, instead of text. While these are “above average” features, they must be integrated with your program at no additional cost.
Consumers are three to five years ahead of local businesses to adapt to changing channels of technology. Catch up with your customers with a mobile loyalty program that is fun, affordable, and profitable. Take advantage of mobile marketing before its competitors.