We are independent & ad-supported. We may earn a commission for purchases made through our links.
Advertiser Disclosure
Our website is an independent, advertising-supported platform. We provide our content free of charge to our readers, and to keep it that way, we rely on revenue generated through advertisements and affiliate partnerships. This means that when you click on certain links on our site and make a purchase, we may earn a commission. Learn more.
How We Make Money
We sustain our operations through affiliate commissions and advertising. If you click on an affiliate link and make a purchase, we may receive a commission from the merchant at no additional cost to you. We also display advertisements on our website, which help generate revenue to support our work and keep our content free for readers. Our editorial team operates independently of our advertising and affiliate partnerships to ensure that our content remains unbiased and focused on providing you with the best information and recommendations based on thorough research and honest evaluations. To remain transparent, we’ve provided a list of our current affiliate partners here.
Business

Our Promise to you

Founded in 2002, our company has been a trusted resource for readers seeking informative and engaging content. Our dedication to quality remains unwavering—and will never change. We follow a strict editorial policy, ensuring that our content is authored by highly qualified professionals and edited by subject matter experts. This guarantees that everything we publish is objective, accurate, and trustworthy.

Over the years, we've refined our approach to cover a wide range of topics, providing readers with reliable and practical advice to enhance their knowledge and skills. That's why millions of readers turn to us each year. Join us in celebrating the joy of learning, guided by standards you can trust.

What Are the Best Tips for Developing Loyalty Programs?

By Maggie Worth
Updated: May 17, 2024
Views: 3,875
Share

It is an accepted axiom of business that it is easier and more profitable to keep existing customers than to gain new ones. Loyalty programs are programs developed to build customer loyalty and increase customer retention. Examples of such programs include frequent-buyer discounts and free item offers after a set number of purchases. Tips for developing solid loyalty programs include understanding what customers value, making customers aware of the program and its benefits and designing a program that the business will be able to sustain.

In order to create effective loyalty programs, businesses must provide rewards that customers find to be valuable. To do this, the business must understand the customers. One way to find out what customers want is to analyze data, such as purchase histories.

Another option is to ask the customers directly. This can be done in a multitude of ways. A business might use survey methodology, either through electronic or print surveys or by conducting customer focus groups. Other businesses might set up customer suggestion boxes or use email or social media to ask customers what types of rewards they most want.

Once a business understands what customers find valuable, it can set up an appropriate program. This might include members-only coupons or sales, free items with purchase or free shipping offers for online purchases. Restaurants and coffee shops, for instance, often offer punch cards that are good for discounts or free items after the purchase of a set number of items. Other programs allow customers to earn points for each purchase, and such points are generally redeemable for merchandise, airline miles or other perks.

Customer loyalty programs cannot be effective unless customers know about them. Businesses must make customers aware through direct mail or email campaigns, by posting signage at registers or on websites, or by announcing programs on social media sites. It is important to give customers complete information about the program, including how to earn rewards, what they can earn and what restrictions might apply.

Another major factor to consider is the sustainability of the program. Businesses should ensure that customer rewards will not be a financial burden. They should also be sure that they have an accurate way to keep track of what customers earn as well as an efficient way to distribute rewards. Businesses that are unable to maintain their loyalty programs likely will find themselves with frustrated customers.

Share
WiseGeek is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.

Editors' Picks

Discussion Comments
Share
https://www.wisegeek.net/what-are-the-best-tips-for-developing-loyalty-programs.htm
Copy this link
WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.

WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.