Customer satisfaction is one of the most beneficial outcome of loyalty cards and the key to success in an organization.
So how does customer loyalty programs relate to customer satisfaction?
Well consumers generally feel more satisfied when they are aware that they are getting an excellent value. When consumers redeem their built up points, or they receive their free product they have been working towards-- They feel a sense of accomplishment and satisfaction.
This customer satisfaction is vital in maintaining your loyal customers and is also extremely important in attaining new customers, as 80% of your customers come from 20% of your customers.
There are many different types of loyalty programs on the market now-a-days. Below I have listed a few of the most popular forms of loyalty programs to date.
Some of you may be thinking, why on earth do these companies just give away all this free stuff? Well the answer is simple. Companies that offer loyalty programs may in fact be benefiting more than you are.
Companies that offer you these rewards are benefiting in the following way;
1. Better Customer Involvement Loyalty programs make customers feel more involved with the brand, and almost act as a game for the customer, challenging them to reach the next level- which means more purchasing!
2. Trend Management Helps you manage who is buying what, when they are buying it, and where they are buying it.
3. Increased Profitability Because these customers feel rewarded when they make purchases, they are more likely to buy more products because it gives them a sense of accomplishment.
According to marketingmag.ca over 70% of customers who sign up for a rewards card lose interest in at least one program they signed up for.
3 ways to keep your customers interested in your program:
1. Keep your reward levels realistic and achievable! It is important to have practical reward levels so that it does not take your customers years to reach a reward level.
2. Dont treat all your card members the same! Use data-mining to observe different shopping patterns of individual customers and segment them so that Joe isnt offered the same rewards as Judy. Maybe Joe wants a new sports magazine, where as Judy wants some new lipstick.
3. Re-ingage inactive customers! Contact customers that haven't used their card in a while, and ask them why. Once you hear their concern, entice them to return to your store by offering them certain incentives.
Now that 2012 is fast passing, its time to see how customer loyalty cards measure up with todays technology.
After a few hours on Apples app store, I found multiple companies that allow you to collect points via your Apple iPhone. Starbucks being the largest company to offer such features (Ofcoarse, I already had this app before my research). Some of you may be wonder what your iPhone has to do with this, but you will see..
Starbucks Rewards allows you to build points and reach certain levels. Myself being a Starbucks addict have already gained access to the "Gold Level". Being a "Gold Member" gives me perks such as free syrups and soy milk added too all of my beverages, as well as every 15th drink I purchase is free!
And to think, I haven't even gotten to the coolest part yet. Upon downloading the Starbucks Rewards App, I can enter in my pre-paid Starbucks card, and use it as my method of payment! All your barista has to do is scan the bar code on your phone, and all the work is done for you!
Watch the below video on how the Starbucks Rewards app works!
(Video is of an android phone, but works on iPhone's as well)
Video Courtesy of: http://www.starbucks.com/coffeehouse/mobile-apps
Multiple coffee shops in Boston have recently started a 'Disloyalty Card' campaign to encourage customers to visit a variety of different independent coffee shops.
Now this idea may seem obscene - to reward customers for going to different coffee shops, however the creator of this campaign does have a novel idea.
To encourage and reward customers to visit other independently owned coffee shops, helps emphasize the service and quality you receive when you avoid the big coffee conglomerate's. Also this gives the customers the ability to mix up their routine, and try different items while not being penalized by losing out on rewards.
I think this great idea will catch on.. FAST. Do you?
Now it is general knowledge that a customer loyalty card is an excellent way to maintain and attract customers, but it leaves us wondering- Who is the genius that started this?
Back in 1872 The Grand Union Tea Company began to give customers tickets that could be exchange for any product in the Grand Union catalogue. This type of premium program was the first of its kind and launched a series of customer loyalty programs such as trading stamps (We still see a bit of this in today's society, such as "Lunch Cards" from Jack Astor's) and box tops (Present day equivalent would be coupons on your cereal box).
So how does customer loyalty programs relate to customer satisfaction?
