Why is Customer Loyalty Rewards Important?
Did you know that improving your client retention rate by 5% may increase your revenues by up to 95%? However, far too frequently, businesses prioritise recruiting new customers above caring for current ones.
It’s understandable that you’d like to expand your clientele. But how can you keep the customers that are more inclined to purchase from you again? One approach is to establish a customer loyalty programme that rewards repeat customers.
Customer loyalty is an ongoing emotional bond between you and your customer, manifested by a customer’s willingness to engage with and purchase from you again and over again, as opposed to your rivals.
Customer loyalty is a consequence of a great experience with you, and it helps to build trust. A well-designed and well-implemented customer loyalty rewards programme may assist you in retaining existing customers, attracting new customers, lowering turnover, and increasing revenues.
A specialised rewards programme with customer loyalty incentives is a fantastic way to express gratitude. It’s apparent that loyalty programmes help your consumers, but what precisely are the advantages of loyalty programmes for a company like yours?
In the broad scheme of things, it’s nothing new; the first known type of customer loyalty marketing dates from 1793! However, the essential components of a loyalty programme haven’t changed much since then.
It’s simply a programme that pays a consumer in return for taking an activity you want them to perform. It’s a part of your larger marketing plan.
Let’s look at some of the benefits of using a customer loyalty reward program for your business.
4 Reasons Why Customer Loyalty Rewards is Important to Your Business
Customer loyalty and satisfaction are two of your most effective marketing instruments. Positive client word-of-mouth is crucial to acquiring new consumers in the age of eCommerce and online review websites. People trust personal referrals more than any other marketing method: 83 per cent of customers.
Customers that suggest new customers can be rewarded with a well-designed loyalty programme. Compared to non-referred customers, recommended customers are more loyal, more lucrative, and have lower churn rates.
In the end, even if client acquisition has historically been expensive if you have the appropriate loyalty programme and a strong marketing plan.
Return on investment (ROI) is greater with repeat consumers. On average, it costs five times more to attract a new client than it does to keep an existing one. Existing customers are 50% more likely than new consumers to try a new product and spend 31% more on each transaction.
Although marketing activities focused on attracting new customers are critical for growth, client retention is where the long-term value is found. If you don’t keep your clients, you’ll have to replace them when they leave.
Customer loyalty may be rewarded through a programme, which can help you avoid high churn rates and retain high-value clients. It’s also a low-cost method of increasing sales.
You can spend less time on traditional advertising and more time on developing meaningful, long-term connections with existing consumers if you build a relevant, engaging incentive programme.
Loyalty programmes improve customer lifetime value and promote sales. When customers perceive that you place great value on them, they’ll likely trust you and become loyal to your brand. Most often than not this is achieved through customer loyalty rewards. The emotional bond that loyalty programs establish is very essential.
By consistently running a customer loyalty program, you will establish an emotional commitment with your customers. Building an emotional commitment with your customers makes them trust you more and stay loyal to your brand, no matter what the competitor is offering.
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More Sales and Revenue
Customers who spend money aren’t the only ones who are valuable to you. Instead, it’s the consumers that produce it. We refer to them as “brand advocates.” And they’ll tell their friends, family, and – for those on social media – their followers about your shop.
Another advantage of a loyalty programme is that it allows you to create a network of supporters. According to a previous study, word-of-mouth (WOM) referrals from friends or family are trusted by at least 92 per cent of consumers more than any other kind of marketing.
What type of customer loyalty rewards should you choose?
Numerous forms of consumer loyalty programmes are now in use in the marketplace. It’s entirely up to you to decide on rewards, activities, and the mechanics of the programme.
However, loyalty programmes may be divided into different categories. One of the most efficient methods is the Easy and Burn method. Earn and Burn is an easy way to make money. A client earns points by completing a specific task for a reward (earn). These points can be spent (or burned) to earn the prize of their choice.
ThankUCash is a multi-merchant loyalty and cashback platform loyalty that uses the Easy and Burn method to reward customers who patronize its registered businesses. It rewards customers with instant cashback every time they shop.
Customers earn points for every purchase they make and these points can be converted to cash and used to purchase another item. Points are earned and redeemed at all ThankUCash merchant stores.
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