6 Tips for setting up a Loyalty Program

As businesses look forward to the promise of hope that a new year brings, they may need to adapt to customers whose shopping habits have changed as a result of the pandemic.  As we experienced shutdowns of non-essential businesses, many of us found different ways of shopping and discovered different brands that we continue to use.  Consequently, businesses may find that their customer base has changed, and they will need to maximize the loyalty of the customers they’ve been able to retain as well as attract new customers.

To help maintain and grow their customer base, businesses may consider running a loyalty program. Loyalty programs can be as simple as offering a discount for product purchased (such as punch cards for coffee, with one being free after multiple purchases) or more complicated, with points offered for purchases made and increasing levels to achieve. 

No matter the size of the program there will be many “moving parts” that must be synchronized in their execution and operation for the program to be successful.  When considering developing and implementing a loyalty program, businesses should keep the following six tips in mind:

1. Start With Well Articulated Objectives
   

   Decide what is to be achieved in the short and long terms and develop objectives that articulate what both the business and their customers hope to achieve with the program.

2. Develop a Detailed Rules Structure  
   

   Once the objectives have been established, a Rules Structure should be developed to provide, in a very succinct way, all aspects of the program. This will include details such as when the program starts, how long it will run for, how participants are to enrol, as well as what the structure of the program is, including rewards.

3. Develop an Effective Communications Strategy
   

   Once the Rules Structure has been developed, it will need to be promoted to advise customers of its existence, what’s in it for them and to generally generate excitement for participation.  Additionally, regular ongoing communication to keep participating customers informed and engaged will help to ensure success of the program. 

4. Involve Field Staff to Help Promote the Value of the Program
   

   If a field staff is available, they can be instrumental in promoting the value of the program with customers and securing their engagement.  However, in order for field staff to be ambassadors, they need to be educated on details of the program so some training and communication should be directed to them.

5. Select Rewards and Awards that are Valued by Customers
   

   In addition, it is important that the rewards and awards selected are valued by the customers participating. Rewards are tokens provided as the result of actions, so it could be getting a tenth cup of coffee free after purchasing nine.  On the other had, awards are usually more substantial and given in recognition for achievement.  These can vary but usually are provided as participants work their way up through levels of achievement, such as bronze, silver or gold. 

6. Monitor Customer Feedback to Continually Improve
   

   The best way to continually improve a program and secure greater loyalty is to monitor customer feedback.  This can be done by paying attention to comments received through social media, call centres (if it’s a large enough program), feedback from field staff or by conducting an annual survey of participating customers.