Is your retail business considering a customer loyalty program?
We say, go for it!
The initial costs may be high, but the right customer loyalty program will pay for itself and more in the long run.
Building customer loyalty is no small thing.
It means more retention, more referrals, and ultimately, more retail sales for you.
Take a look at the data to see what we mean!
1. Customer Loyalty Programs Increase Customer Retention
Consumer behavior is the study of why customers like yours choose to shop at one retail business over another.
It all comes down to human psychology.
We, humans, value two things that will keep us coming back to the business that offers them–inclusion and achievement.
Membership-based customer loyalty programs create inclusion, and rewards-based customer loyalty programs create a framework in which your customers can achieve something.
This psychological approach makes customer loyalty programs great for customer retention!
2. Customer Loyalty Programs Increase Retail Sales
Customer retention is a strong key performance indicator (KPI) for a retail business.
Repeat customers spend more money than new customers do.
In addition, businesses who implement customer loyalty programs make more money than those that do not.
Amazon Prime members spend almost twice as much as non-members.
Because customer loyalty programs retain customers, they increase retail sales for the businesses who use them!
3. Customer Loyalty Programs Save Money
Customer retention also has implications for cost savings.
Common knowledge states that it costs five times as much money to earn a new customer than it does to retain an old one.
Customer loyalty programs not only pay out, but keep more money in your retail business!
4. Customer Loyalty Programs Generate Referrals
Satisfied and loyal customers are more likely to get vocal about their preference for your retail business than new customers who do not trust you yet.
This is called “word-of-mouth-marketing” or “WOMM.”
Customer loyalty programs create brand advocates who are more than happy to bring in referrals!
5. Customer Loyalty Programs Are Market Research for Your Retail Business
Market research can be pricey, but customer loyalty programs provide market research as an added benefit!
Whenever you launch a new membership or rewards program at your retail business, you are testing to see how your customers will respond.
The results of the new launch will give you valuable data for pivoting future programs!
Ready to increase retail sales, receive referrals, and retain your most valuable customers?
Launch a customer loyalty program!
If you are interested in getting a customer loyalty program started for your retail business, we would love to talk with you at Cornerstone Credit.
Our team has been providing payment processing solutions for retail businesses like yours for almost 20 years.