Increase Customer Retention with Loyalty Programs
Every e-commerce brand that is serious about customer retention should make a loyalty program a key part of its business strategy.
As you will know, keeping your customers engaged and interested enough with your products and brand is an increasing challenge in an online world in which customer attention is one of the most valuable commodities out there. Sometimes a good product is not enough to make customers come back for more. You need to figure out the things that will make you stand out from the crowd, and launching your own loyalty program is without doubt one of the best ways of doing this.
Let us explain how to set up a loyalty program which will improve your customer retention rate.
Settle on a Strategy and the Tactics and Tools You Will Use
The first thing that you need to do when beginning the customer retention process is to outline a strategy. This strategy will consist of three levels which make up a model that will be streamlined to help you hit your targets. The first level is your overall strategy, which includes your plan and targets. The second level will detail the tactics and actions that you will use to achieve these targets. Finally, you will decide on the tools and systems that you will use as part of your tactics.
If you plan your customer retention process like this, you should be able to sort out a watertight action plan that will set you up well when it comes down to business.
4 Tips to Help You Design a Winning Program
Every effective loyalty program depends on working out how you can best tailor what you are prepared to offer to your customer base. To help you on your way, we have put together this list of four essential tips to ensure that your program leads to high customer retention rates.
- Try Gamifying Your Rewards
Gamification is the process of integrating game mechanics into your website or application as a means of motivating engagement, participation and loyalty. Gamification can be a very powerful tool when it comes to customer retention since it allows you to hook your customers in order to keep them coming back. Part of gamification involves creating a tiered system with objectives and incentives to reach the next level.
- Customize Your Program to Your Target Audience
It will come as no surprise that a program which is customized to the tastes and needs of your customers will have a much higher rate of success that one that is not. But how exactly do you gauge what your customer base will respond best too? The first step is to survey a small section of your customers using a questionnaire that pitches some of the ways you have come up with for creating a winning loyalty experience.
- Set Up a Referral Scheme
One of the best ways of keeping people interested is to offer a good referral scheme. Giving a 10% off credit or another incentive for each time one of your customers refers a friend, and this friend then buys from you is a great example of this. Referral schemes are a smart way of increasing the profile of your brand in an organic way as you will incentivize your customers to market your product to their friends and family as they try to get a referral.
- Do Not Overcomplicate Things
It does not matter how attractive what you are offering is; if people cannot make head nor tail of the hoops that they have to jump through to qualify for your offer, all the long hours of designing for it will ultimately yield few results. The aim of the game is always to keep things simple enough so that every one of your customers will be able to understand how it works.
The benefits that a well-designed loyalty program can bring to your e-commerce company cannot be overstated. If you get it right, you should soon see that elusive rise in customer retention rate that is the hallmark of any healthy business. By following the tips above, you should be able to engage and interact with your customers in a way that hooks them and boosts your sales.