Loyalty schemes, how do I produce one?
Loyalty schemes are designed to get customers to use your company rather than someone elses. Frequently, these take the form of collector schemes but not always. These are separate from customer referral schemes, which can be continued alongside this scheme.
1) Select your aim
What do you want to occur? Do you want more contracts in your quiet times? Do you want customers to spend more when they visit, or buy other products?
Example:
A restaurant starts opening in the mornings to sell coffees and cakes. They have a continuous flow of clients who enjoy the restaurant, who love what they do, but presently use different local cafes for morning coffees. They are certain that an amount of clients will want to use them anyway, but need to give them a reason to visit.
Objective: Encourage existing customers to try them out in the morning. It will be a success if we get 15 covers per day before 12noon.
2) Decide on your mechanic and reward
The mechanic is how the scheme will work. The watchword here is don’t set it too hard! If you have to have three MOT tests to get one free, that would take years to collect! The easier it is, the more successful it will be.
Collector schemes (like the McDonalds purchase 6 coffees and get one free collector cards) operate effectively with commonly purchased items. Spend ?X and recieve a reward may operate better with our restaurant model.
What can you afford to reward your customers devotion with? This will depend on your class of business. For many businesses, the temptation is is to hand out items that the client would have bought in any case. This would operate well if the profit is good, and the product is a consumable. Don’t forget that you can additionally give away items such as promotional pens, trolley tokens or mugs.
Example:
The restaurant feels that while coffee is inexpensive to give away. It would be better to at least get an amount of revenue and so the offer might be: spend ?10 or more and get a voucher for a free coffee when you buy any cake before 12 noon. This is probably about as complex as you want to go in this type of establishment. Remember the goal is to gain existing lunch and dinner clients to visit in the morning.
The reward is just a business-card with the new opening hours, a brief sumary of the free promotion, a ‘Thank you’ for using us and ‘the rule’. Simple, inexpensive and professional. The waitress would give these out with the bills, and they can be collected in the mornings and they were exchanged for the reward. The rule? Always have an expiry date. Even if you don’t stick rigidly to it, you should have a date. You may also use these to gather customer information.
3) Measure the response rate
Using cards will enable you to track your redemption pace and as a consequence how successful the promotion was. Remember, giving away the rewards is fantastic! The measure of effectiveness will be linked back to the goal. Did we get our 15 covers per day?
So, how much will it cost to run this promotional activity?
Cost of 1000, full colour, double sided business cards to use as the voucher, plus an expert designer to make it look fantastic: ?160+vat.
The giveways: ?20 worth of coffee
So for under ?200, you can begin building your reward scheme today!
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