LOYALTY PROGRAMMS
Any business existing on well established markets earlier or later come to situation where 'price-quality'
ratio of his offers becomes indistinguishable with ratio of competitors. At that moment companies start to
search for a new ways to increase their competitive advantage. Find new, and what's more important, retain
existing clients is a main goal of customer relationships marketing, who's main instrument are loyalty programs.
Main purpose of loyalty programs
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Retention of existing clients achieved by flexible loyalty rewards system.
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Amplification of goods/services volumes consumed by loyal satisfied clients.
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Attraction of new clients by recommendations of existing ones.
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Client loyalty – preference of the goods/services of the certain manufacturer, the seller or the supplier.
The preference which forces to consume even endowing something. A really loyal consumer will not change
the affections because of competitors’ discounts, will not leave for them even after your false step, and will sincerely
recommend you Company to friends and colleagues.
Which clients are worth struggling for and what good it is
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20% of clients give 80 % of profit (a special case of "the Law of Pareto»). These of 20 % of clients also should to try be kept.
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Steadily loyal client starts to expand assortment of the consumed goods/services of your company.
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Using loyalty programs leads to reduction of clients turnover and also raises predictability of your returns.
At the rate on existing clients decrease in the costs connected with attraction of new clients is reached (advertising etc.) Besides, the constant consumer usually spends more and with it, as a rule, less contradictions.
On what to construct client attachment
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The special prices intended for loyal clients - the fixed and progressive discounts.
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System of encouragements of loyal clients - bonuses, memory discounts.
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The special relation, special services and special service of loyal clients. (*)
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Prizes, awards, lotteries, gifts, clubs and associations. (*)
(*) - Completely depends on business of the company and understanding of principles of work with the given type of clients in the company.
Does not give in to automation.
Who does not require loyalty programs
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Companies that have no competitors, providing unique services or having exclusive market position.
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Companies having to solve first-order problems before thinking about customer reward programs.
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Discounters - companies having one real marketing tool - the price.
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BONUS POINTS PROGRAMMS
The loyalty program which use only price discounts, will sooner or later lead to profit losses. In price wars there is no winner.
What's more important, using only price discounts, you will not attract clients, who are interesting for you in long terms.
Establishing loyalty bonus programs is proven to be much more more effective.
Bonus programs advantages
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Selectivity. Building effective focused offers for specific target groups.
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Economy. Increase advertisement effectiveness while decreasing spending on it, deferred pay outs.
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Consistency. Reward not a single purchase but proper purchase history.
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Bonus - a registration unit of loyalty of the client in this or that form. Bonuses are
usually used for definition of size of compensation to the client. The basic idea of bonus programs consists
that not the single purchase, but whole consumer purchases history is analyzed and rewarded. Bonuses can be charged
depending on the spent means,
number of visits, total cost of last purchases. After the bonus sum under this or that program will reach
the established size, the client according to program conditions is promoted in this or that form. The encouragement
kind completely depends on your type of business and is not necessarily material. It can be an exchange for
additional privileges etc., in this point in question the imagination of your experts in marketing can be
boundless.
It is necessary to consider that at use of the bonus scheme the buyer has satisfaction at least twice - at purchase
with charge of bonuses and at the moment of their exchange. Besides, at use of any of possible schemes of
payment of bonuses the buyer comes back to you again, and that is probable, will date visit for necessity
of new purchase.
At use of client base in work with the bonus scheme possibility of formation of offers addressed to the concrete
consumer group giving the maximum return, and even individual encouragements to concrete clients is most obvious.
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OUR COMPANY SERVICES
High costs for development and deployment of specialized management and control systems for proper calculations of
bonus points were always a factors which hamper establishment of bonus loyalty programs. Implementing such systems
always required significant amount of time and resources. Our company gives free online access to software product
for loyalty bonus programs management tunable for any type of business, from online shop to social networks support site.
We offer
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Free of charge - toolkit for construction of your programs with it is unique short time of start of the project.
- If necessary - support and adaptation of software for your individual requirements.
- If necessary - consulting services in the field of technologies of construction of programs of loyalty.
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PointLoyalty company has been established in 2007 with an aim to create online product with
generalized approach of bonus loyalty programs support.
Our task is to make loaylty programs affordable and easy to use for small to medium size businesses.
Company employees in previous years took part in several large projects relevant to managing loyalty programs.
Therefore they have deep knowledge in the field of creating such software.
We offer free of charge a product suitable for any business, easy to use and allowing to create fairly complex loyalty
programs. We provide technical support and a list of additional services.
We give you a chance to manage your loyalty program in a very convenient way - remotely, fast, free of charge and with a best quality.
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LINKS AND RECOMMENDATIONS
Before introducing in your company the client loyalty reward programs it is recommended
to analyze strong and weak sides of your business and study your clients and competitors. It is desirable to formulate
accurately that particularly you wish to receive as a result of introduction of the program of loyalty.
What to start with
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Make sure you don't have any problems in your business which can be solved without offering loyalty programs.
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Make yourself familiar with the theory, review successful and failed projects in your business domain.
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Define concrete goal you want to achieve, estimate ROI interval, give figures on all your estimations.
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It’s not necessary to start the loyalty programs installation if the stimulus is only unfounded directions from above,
an attempt to follow the fashion or the desire to keep pace with others. In this case, playing with loyally will
take a lot of time, divert from resolving more vital problems and will bring nothing but disappointment.
When to start
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In your business you don’t have the obvious weaknesses, defects, problems, which prevent caching up with concurrent.
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You know why your company needs the loyalty program. The program goal is defined.
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You understand that the loyalty programs efficiency has the strategic character, and its results won’t be received immediately.
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You selected the target group of the program by defining the group of clients you are interested in and you don’t try to please everybody.
If all statements above are true – You are on the right way
Recommended literature
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