Loyalty marketing is big business and customers are expecting more from brands than ever before!
Business owners, entrepreneurs and marketing managers know that utilizing loyalty is a must in today’s competitive market. A recent study from B2B International found that 54% of B2B marketers said making customers more loyal was a leading business challenge.
Loyalty programs are used by thousands of businesses around the world because marketers know that keeping customers loyal can help your business strike gold.
This Pathwwway Gamble article will define:
- What loyalty marketing is
- What it can do for your business
- How to target specific demographics in your strategy
What is Loyalty Marketing?
But what are loyalty programmes? You will have of course come across them in your everyday purchasing experience. Loyalty rewards are the points you collect on your weekly shop, or the bonus free coffee you get from your favourite coffee shop after loyally buying six beverages.
Customers can be fickle, not only do they want you to convince them on the reasons they should buy into your brand, but they want rewards for sticking with you. Many consumers will even switch brands completely if they feel their loyalty is better valued, in terms of rewards or freebies, elsewhere.
Loyalty marketing is a strand of marketing where a business focuses on growing and retaining their customer base through incentives, such as rewards, discounts and personalized offers. This kind of marketing is designed to encourage customers to make purchases again and again.
- What can a Loyalty program really do for my business?
Loyalty programmes have been inspiring loyalty from customers for decades, there not just an internet marketing buzzword with little data. Loyalty driven programmes and strategies are a proven way to keep your customers happy and returning to your store to purchase again and again.
There are numerous advantages that come from adding Pathwwway Gamble customer loyalty programs into your marketing efforts. Here’s a quick look at measurable benefits to whet your appetite:
- Increase your profitability
The first benefit of using loyalty rewards is that you’re likely to see a direct rise in sales, which of course automatically boosts revenue. Research shows that on average 20% of loyal customers can generate up to 80% of general revenue of any business. Loyalty programs are therefore designed to serve as a basic customer retention tool.
- Access a wealth of data
Every time a customer makes a purchase, redeems points, chooses a reward or any other loyalty gaining activity you’ll have that data stored in your computer systems. This big data is often a priceless insight into your customer’s preferences and purchasing habits. You can analyze the patterns of their decisions and preferences to gain vast knowledge about your customer base. This knowledge can be used to inform your marketing plans and strategies amongst other uses such as personalization and customer experience.
- Evoking positive emotion
Loyalty marketing programs play an integral role in the complicated and time-consuming process of building a meaningful relationship your customer. Loyalty Programmes give you the opportunity to make relevant contact through various channels and offer personalized discounts or recommendations. This makes the relationship much more personal and creates a positive environment to become attached to your brand.
- How to target specific demographics in your strategy
For your loyalty marketing plan to be successful you need to target your campaign around a specific demographic.
Which demographic is the most suited to your business? Millennials or Baby Boomers? Female or male focused? Once you have your ideal demographic identified, it’s time to design your loyalty program.
When you are clear about which consumers are most likely to connect with your business, you can apply this knowledge to designing your loyalty rewards plan, to make sure what you’re offering is relevant to your target audience.
This will allow you to construct a better, more personalized loyalty program, which will in turn create the ideal buying experience for your particular demographic.
- Do You Want To Target The Millennial Demographic?
According to the latest research customers aged between 17-34 will spend $200 billion annually from 2017 onwards. But what kind of loyalty program can encourage millennials to align themselves with your brand?
It’s apparent that millennials want brands to reflect on their personalities. Millennials engage and are loyal to brands that are fun and entertaining.
Members of this generation are willing to divulge more personal information than older generations and as a result they expect brands to know them well. The baseline for this audience is for you to know what they like, how they speak, and which values are most important to them.
- How to design a loyalty program for Millennials
Your loyalty program should reward the activities that millennials love to do rather than just traditional purchases.
Millennials have grown up with the internet and they love to watch videos, post to Instagram, share on social media and leave product reviews. These are all perfect examples of modern activities that you can design into your loyalty scheme.
Modern loyalty programs reward these activities by writing them into the coding of their apps and websites. It’s important that you are creative when targeting millennials, and that you come up with something fun but in keeping with your business’ personality.
- Do You Want to Target the Baby Boomer Demographic?
If you want to design a loyalty marketing program that Baby Boomers will be fighting to sign up for, you need to understand what they’re looking for and what they want in a rewards scheme.
Born between 1946 and 1964 this generation represents almost 20% of American consumers. But don’t be put off by the percentage, Boomers are the most financially successful customer demographic. Over 90% of them are financially stable with heaps of disposable income to part with.
- How to design a Loyalty Program for Baby Boomers
So how do you design your loyalty program around this demographic? It’s important that your rewards scheme offers additional value to your loyal customers.
Although discounts can be used, to truly give value to your customers a modern loyalty program needs to offer more than just simple discounts.
Tiered programs are great way to entice baby boomers to your business because just like everybody else Boomers like to feel special. Offering them exclusive rewards in exchange for their loyalty is a great idea!
Exclusive rewards give your loyalty program a sophistication and professionalism that fixed discounts alone simply can’t deliver.
In general it can be a challenge to win this generation’s loyalty, however once that loyalty has been won they’ll remain loyal until the very end.
Design you loyalty marketing program with exclusivity and value in mind and it’s sure to keep baby boomers coming back for more!