Having a Loyalty App Will Help Increase Your Bottom Line
It costs the average business 6-7 times more to acquire a new customer than it does to retain a current one according to a recent report by Bain and Company. Businesses that invest in a loyalty program are more likely to see a positive impact on their bottom line than those who stick to more traditional forms of advertising.
Even if your business has a loyalty program in place, unless you utilize it as a form of direct marketing, then you are not reaping all the benefits possible from your program.
A recent study by AC Nielson shows that 60% of consumers deem whether or not a business has a loyalty program an important factor in their purchasing decisions. The study also reported that consumers spend 46% more with businesses that have loyalty programs.
Another recent study done by Loyalogy found that nearly 65% of consumers would recommend a business more to others if that business had an appealing rewards program. The study further found that 84% of consumers prefer a rewards program that clearly states how they will receive rewards. For example, they prefer to know that for every X amount of purchases, they will receive something for free or at a discount, versus waiting for “surprise” rewards or discounts.
Probably the most exciting statistics for merchants is one discussed by the Head of Analytics at IQR Consulting, Nagendra Sastry. Sastry reports that membership in loyalty programs is growing at a rate of 26.7% with 2.65 billion memberships in the US (8.4 for every person), and that loyalty programs can increase a brand’s market share by 20%.
What do all of these numbers really mean for you and your business? That now more than ever is the time to invest in building a loyalty program, specifically one that is “mobile first.” While traditional programs with punch cards are easy, those that focus on getting on a customer’s smartphone have greater options for reaching that customer and getting them to think about and visit your business. This is because loyalty programs built inside of an application allow for better customer data, and enable you to develop direct marketing campaigns for people who already like your brand and frequently make purchases.
One of the easiest and most efficient ways to implement a loyalty program is to integrate it with your point-of-sale system. By doing this, you receive the maximum amount of customer data, and make it easier on your customers.
Another important factor to remember when building your loyalty program is choosing a reward that will drive a shift in consumer behavior, i.e. they come in more frequently and make purchases. Finally, keep things simple.
Not only should using the loyalty app be easy for your customers, running and maintaining it should be easy for you as well.
Originally published on FastCasual.com