5 Reasons To Reward & Incentivise Your Customers - REASON #4
IT'S LESS EXPENSIVE THAN YOU THOUGHT!
Think of a loyalty program and you could be forgiven for imagining that a large pot of your resources are going to be funneled off into a program that may or may not reap you the rewards you hoped for.
The reality, however, is that the true cost falls on the other side - it costs far more to acquire new customers than it does to keep the ones you already have and this is attested to by all the main analysts and business gurus. The numbers tell us that it can be 7 times LESS expensive keeping existing customers than acquiring new ones. So the resources you utilise in a loyalty program are likely to pale in comparison to the expense and effort in finding new customers. The slight expenses you incur by setting up a loyalty rewards program will be overshadowed by the additional business generated as a result.
“"There is a spiritual aspect to our lives — when we give, we receive — when a business does something good for somebody, that somebody feels good about them!”
Ben Cohen, Co-founder Ben & Jerry's
Auto-Pilot Customers
When setting up a rewards system it's advisable to take some time to research. Find out the preferences of your customers - do they sway more towards discounts than free gifts? Do they have a leaning to rewards for passing on referrals over rewards for purchases? That's not to say you have to do one or the other but it gives you an insight into how you might want to set up the program and where your engagement is most likely to pick up.
Your loyalty/rewards scheme effectively becomes a self-sustaining machine, for the most part, due to its cyclical nature: the more purchases a customer makes, the more rewards he or she will receive - and they are inspired to continue purchasing.
Revisit your initial research and updating the rewards as this will help to keep your customers engaged.
