Loyal customers play an important role in the success of any business. 60% of merchants say that sales from loyal customers account for 70% of total sales. However, how to retain customers effectively and increase the number of loyal customers? There are several ways to earn customer loyalty, and customer loyalty programs are the popular choice of many companies. This article aims to guide merchants how to create a customer loyalty program in 3 steps.
Why do merchants need to create a customer loyalty program?
A customer loyalty program is necessary for a company to retain customers. There are some facts that prove the importance of making a customer loyalty program for any business.
- 80% of company’s revenue comes from 20% of customers
- Loyalty programs can increase sales by at least 30%
- Keeping existing customers is easier than winning ones
Create a great customer loyalty program in 3 steps
1. Study your customers
Before making any loyalty program, you should know your customers very well to offer suitable programs that attract them to engage in and buy more. There are some questions you should answer first to know about your customers:
- How many products do they buy?
- What type of products do they buy and how frequent are purchased?
- How long have they been a customer?
- Are they satisfied with products?
- What encourages they buy more?
Besides, business men or women could use loyalty data to understand deeply about their customers. You could use customer data from previous loyalty programs to orient new ones. Using purchasing habits to personally target consumers will be a great strategy to increase customer loyalty. If you want to create a customer loyalty program, you need to make sure that your customers interested in it. To do that, it is important to study customers to understand their preference and habit.
2. Determine your goals and target customers
After researching customers, you should define goals for this loyalty program and target customers. You should set clear goals for sales revenue, sales growth, the average frequency of purchases. The budget should be set for activities of each loyalty program. Some criteria you could use to define your target customers such as the volume of purchases, buyer power and level of loyalty. This step will help you to prepare well for creating a customer loyalty program.
3. Launch a customer loyalty program
In this step, you should write in detail about your program. What type of reward do you give to customers? How many percentages of discount? What’s about your customer service? All questions should be considered when you launch any program to earn customer loyalty. When launching a customer loyalty program, you must make sure that you communicate your program with customers. For example, you can ask them “Do you like to join in our new loyalty program?” or you share information about the program on social media, websites, etc.
Follow these steps to create a customer loyalty program now
With three simple steps, you can create a customer loyalty program to retain your customers and increase sales rapidly. In order to be successful, you should make sure that you define the right target customers, having a clear plan and good communication. Try these steps and create a customer loyalty program to boost sales and increase the number of loyal customers now.