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Guidelines for Selecting the Best Customer Loyalty Program

In today’s economy, it’s wise for merchants to place as much importance on customer retention as they do on acquisition. It is common business knowledge that it costs 3-5 times more to acquire a new customer than it does to keep an existing one. So what is being done to retain customers?

Among the most successful customer retention strategies in recent years are loyalty programs. Across the country, airlines (frequent flyer miles) and grocery stores (VIP cards) have taken great advantage of rewards programs. As for locals, who hasn’t had a neighborhood sandwich shop punch card tucked in their wallet or purse?

While promoting the same concept, these examples are actually quite different. Airline and supermarket loyalty programs distribute rewards and capture customer information. The sandwich shop program only distributes rewards. It does not collect any information to further benefit the consumer or their business.

Tip #1: When planning your customer loyalty program, I suggest you avoid traditional (punch) cards. Opt for a mobile system instead. The technology is current, it’s popular with consumers, and it gives you a highly effective communication tool.

Don’t mistake communicating with consumers via their cell phone as spam! Customers “opt in” to participate and have the option to “opt out” at any time.

According to Nielsen ratings, more than 90% of the population aged 13 and over carry a mobile phone. Of these, more than 90% carry their mobile phone with them 24 hours a day.

Your advantage: Text messages have the fastest read rate at 90% in 15 minutes with a final open rate of 97% (email offers a high average open rate of 17% in 48 hours). No other system gives you a more powerful way to engage with your customers!

When looking for mobile loyalty programs, select a system that uses your customers’ mobile phones and email addresses for data collection, so you don’t disrupt the flow of your business. The program should consist of a self check-in station or allow customers to provide only their mobile phone number or email address to the cashier at checkout, who then enters it into the Point of Sale terminal. The system itself must collect any additional information (such as birthdays, anniversaries, etc.) outside of the checkout line to make it fast enough even for quick service restaurants to implement.

Tip #2: Your mobile loyalty program should communicate with consumers through text and email. Since information is collected via text and email, the program should automatically attach customer addresses to your consumer base listings. You can then text and email them at any time using a web-based program.

Don’t misuse text messages and emails or your customers will quickly “opt out” of the program. Any communication must be beneficial to your customers and should not exceed 3-4 messages per month.

Your advantage: Text messages are personal and allow for instant two-way communication. You are establishing a profitable relationship with your customer!

Tip #3: Your program should be completely automatic. During customer checkout, you should only need a mobile phone number or email address to issue credits and distribute rewards (and never interrupt the flow of business). In addition, your program should also automatically distribute birthday and anniversary promotions.

Nearly all mobile services measure coupon redemption/email open rates and offer extensive reporting capabilities so you can tweak your program and maximize your bottom line.

Now, that’s essentially all the features included with ordinary mobile loyalty programs. Of course you don’t want to be normal! Your program must be better than average, unique. Consult for additional functions.

For example, there is a mobile customer loyalty provider (the only one I know of) that is fully integrated with Facebook. That makes the subscription companies service unique from its competitors and allows Facebook users to register with one click to complete the registration. The program then posts relevant ads on customers’ walls and makes exclusive offers to their friends by following the hyperlinks. The viral nature of Facebook itself makes this a great way to build a loyalty program.

Another example of additional features is the ability to transmit voice transmissions, if preferred, instead of text. While these are “above average” features, they should be integrated with your program at no additional cost.

Consumers are three to five years ahead of local businesses in adapting to changing technology channels. Catch up with your customers with a mobile loyalty program that’s fun, affordable, and profitable. take advantage of mobile marketing before its competitors.

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