Singapore
Singapore
All businesses aim for repeat customers – after all, it costs much less to continue to sell to an existing customer than to try to acquire a new one. At the same time, however, companies should be wary of simply aiming for regular repeat customers, and instead focus their efforts on cultivating loyal ones.
Unlike customers who are truly loyal to your brand and products, repeat customers (i.e. customers who frequently make a purchase from you, but have no real affinity with your brand) can easily switch product or service providers if a better deal emerges, or if something goes wrong. Loyal customers, on the other hand, are fully aware of what you are able to provide them, and are more than willing to stick with you based on the good experiences they’ve had with your brand.
Similarly, repeat customers often have to make the conscious decision whether to go with your company or with a competitor. For loyal customers, your brand is most likely to be top-of-mind – one that they would choose even without having to think about it.
Lastly, loyal customers act as unofficial brand ambassadors by promoting your products and services to their friends, families and colleagues – something that definitely adds great value to your brand equity!
A loyalty program is a good starting point when it comes to convincing customers to stick with your products, but it has to be well executed in order for it to be effective. Here are some simple ways to structure and improve on your current loyalty program.
Many loyalty programs make the unfortunate mistake of making their point system too complicated, both confusing and frustrating customers.
A straightforward and simple relationship between the amount spent on products and points earned is best. This allows customers to be quickly and easily aware of the number of points they currently have or potentially can earn on their next purchase.
This allows you to give customers simple rewards from their first few purchases, giving them an incentive to even join the loyalty program. At the same time, it also gives more loyal customers an incentive to purchase more to collect more points.
The tiered system should be structured such that better and more desirable rewards can be exchanged as customers accumulate more points and move up the tiers. This will also allow companies to easily identify their most loyal customers.
This requires an understanding of the company’s customer base and what other kind of products they might find desirable. Further discounts or promotions may not always be attractive enough as rewards.
For many companies, this means partnering with other brands to come up with a more comprehensive rewards catalogue that runs the gamut from shopping vouchers to household products.
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