So you want to reward your existing customers, but how do you go about it?

You could go for the obvious one and give discounts on future purchases – but loyalty is very rarely just about money. People who shop for the cheapest price are not loyal to you – they are loyal to the cheapest deal and will move from supplier to supplier to get it. Before you jump in to a loyalty program – make sure you consider all the factors.

Customer loyalty is very subjective. To have a good loyalty system you need a variety of strategies that will suit different types of customers – depending on what their current and potential value is to you, referral value and their motivators.

1. Information is king – Haven’t you found a time when you keep going back to the same supplier because they know your history – and going to someone new would involve the hassle of filling them in and providing them with all your documentation all over again?

Knowing your customer can be one of the best loyalty programs you will ever invest in.

But once you get to a certain number of customers, it is easy to forget what they spoke to you about last, or what their partners’ name was. The key is for you to be able to show the customers that you know them better than the competition and that you will deliver better service. This perception can easily be destroyed if you can’t recall details about your past relationship / conversations.

But we aren’t super heroes – we can only remember so much, so keeping up to date and accurate records of conversations, interests, partner names, services/products used in the past and ones they have expressed an interest in for the future.

Depending on the size of your business, this can be done with a spreadsheet, small database or a Customer Relationship Management (CRM) system.

2. Have loyalty programs that address your customer’s motivators – For example – if your customer is only interested in money, the loyalty program will need to be dollar related. If your customer is interested in feeling valued, your loyalty program should be able to meet that need.

3. Make sure your loyalty programs are not defeating the purpose – Having loyalty programs is great – but at the end of the day, loyalty programs are about profitability – so ensure your loyalty programs aren’t costing you more than you are making by keeping that customer. You may need some loyalty strategies that are low cost, and some that are a higher cost for more profitable customer segments.

4. Value your service – Finally – remember that you are offering a valuable product / service. You don’t need to “bribe” your customers to talk to you or to use your services again. That kind of relationship only ever ends up one way – the customer will go with whoever is offering the “biggest incentive”.

Loyalty programs target genuine customers with the aim of showing your appreciation of their continued support and to reinforce the fact that they are a valued and important part of your business.

Rewarding customers will secure you repeat business and ensure they feel they are getting a return for their continued support.

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