Sometimes, we’re all ever so focused on instant rewards that we’re forgetting some of the bigger, more long-term results. Customer loyalty is one of those.
It has been proven time and time again that retention is the most effective indicator of your store’s performance—especially in the mCommerce world—as loyal customers will not only stay with your brand but will spread good image of your brand. And that’s why, in this SimiCart weekly article, we’ll be showing you some tips on how to make the most out of your store’s loyalty program.
Why loyalty matters
Loyal customers are critical to business growth. A returning customer is much more profitable than the new one as they cost less for your brand to keep and spend more each time. If you ever wonder how important is loyalty program, go through some of the most important statistics of customer loyalty by Annex Cloud:
- 5% increase in retention rate can lead to up to 125% lift in profit
- Acquiring a new customer costs up to 7 times more than keeping a current one.
- 80% of your future revenue comes from as little as 20% of your existing customers
Mobile apps present a huge potential for growing brand loyalty
How brands can make the best of their loyalty programs with a mobile app
1. Offer a variety of ways to get rewarded
Not only wins loyalty from your existing customers, this reward program can also turn them into your brand’s marketing army. Customers nowadays don’t trust all kind of advertisements as before. In fact, people tend to turn to their trusted sources rather than marketing channels to make decisions, including friends, family, customers reviews…submitted across many popular social channels. In order to build loyalty programs offering more benefits for both you and customers, you can, for example, reward your existing customers for each successful referral they made or share with their friends on social media. In consequence, every customer of yours can become a powerful marketer with a great capability to attract high potential future customers.
Customers referred by other customers have a 37% higher retention rate, and are 18% more loyal than customers acquired by other means.
2. Create both desirable and achievable rewards
A loyalty program is a win-win strategy. Offer your customers value and they give your brand their loyalty as a return. The right rewards can make it harder for customers to shop at a competitor. Keeping your rewards appealing and obtainable at the same time is the key:
3. Give increasing rewards for moving up the loyalty ladder
- Always give your best customers the benefits that match their value to your brand. Don’t forget to let others know what you are offering your best customers. If the rewards are desirable enough, you can get other customers striving for these benefits. By setting increasing rewards along with their loyalty journey, you give them endless motivation to come back to your app and strengthen their relationships with your brands.
- You can make the journey even more exciting by allowing customers to feel the progress they made that shows how close they are to the next reward. As long as shoppers see the next value you are offering, they start to participate more actively to get there quick. To grab a little bit more attention, make it urgent. Limit their time to achieve an appealing reward that pushes your customers to perform profitable actions immediately.
4. Remind your customers outside your app with Push Notification
5. Monitor and measure your app’s performance
- Monthly Active Users: the number of unique app users for a thirty day period.
- Average Order Value: the average total of every order placed with your business over a defined period of time.
- Repeat Purchase Rate: the proportion of customers that have shopped more than once.
- Customer Lifetime Value: the net profit attributed to the entire future relationship with a customer.
- Point Redemption Rate: the percentage of your issued points that are being converted into a reward.
Time to integrate loyalty program into your app