How Do You Build Successful Customer Loyalty Programs?

In the past, marketing teams have spent time and resources pouring all their energies into product positioning and messaging in order to attract new customers. Nevertheless, while creating new sales is critical on one side, pushing existing customers into repeat buying is also crucial. Studies have revealed that it is 6 times more important to retain a customer than to gain a new one from scratch. 

It therefore makes sense to invest more in customer loyalty programs. The right digital technologies and marketing platforms can support this initiative well. 

While it is important to pay attention towards customer loyalty, turning your customers into brand loyalists is not an easy feat. For this, you need a predictable and repeatable strategy to incentivize customers to come to you again and again. 

Let’s see how brands have created exemplary customer loyalty programs for their customers for some learnings and takeaways:

Customer Loyalty Programs – Defined

A customer loyalty program or a reward program is a marketing strategy meant to reward customers who are continuously buying from the same brand. These rewards encourage customers to buy more and more, creating a timeless connection between the brand and the customer. 

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Plenty of techniques will help you initiate and excel at the brand-customer bond. The following examples of global brands can serve as a learning: 

• The Point Program by – The North Face

It is a simple system focusing on the more you spend the more you earn concept. One good example is presented by The North Face, and the brand has made it quite easy for its customers to understand. With each online purchase of $1, a customer earns 10 points , and they earn 5 points to spend $1 in their physical outlets. The customers can use these points against their future purchases. 

The brand also has an app where users can purchase goods, check their points, redeem them and more. So, the brand keeps the customers glued all the time. 

• The Paid Program by Barnes & Nobles

Incentive programs are a common thing, but Barnes & Nobles have taken it to another level. In such loyalty programs, a customer has to pay either monthly or annual fees to join the brand’s VIP members club. These programs are mostly marketed to existing users and frequent buyers. 

The VIP program of Barnes & Nobles costs $25 a year, and the program brings an array of benefits for the customers such as heavy discounts, free shipping and lots more. Customers do not join such programs on their own, they need to be encouraged and attracted into taking this up. 

• The Charity Program by The Body Shop

Not every loyalty program may need discounts, some would urge customers to give back something to the society. How about incorporating some business values into a program to build a relationship with your customers? In fact, with these programs, customers are more likely to become brand loyalists. 

Take the example of the Body Shop – with their animal welfare approach. Customers of the Body Shop can earn rewards, avail VIP benefits and they have the liberty to donate these rewards to Born Free USA (an animal charity program).

Similarly, the core value of The Body Shop is their environmental responsibility, which makes it more lovable among its users. 

• The Progress Program by Nike

We all love progressing and so do our customers. 

The more we feel we are nearing a goal, the more we work to achieve it. This phenomenon is also known as endowed progress effect, and it is also an effective trigger to initiate a loyalty program. 

One great example comes from popular sports brand – Nike. The brand has various training apps to help members reach their training goals. For instance, The Nike Training Club and The Nike Run Club apps rewards users with badges and other perks every time they reach a new milestone like finishing a run of 5K. 

In this way, Nike also knows the more success their customers have with the training, the more loyal the customers will be, simply because customers will always associate their fitness success with the brand. 

Creating appealing customer loyalty programs offers a great way to bring more loyal customers to the fore. These programs will keep reminding your customers about your brand and should be a priority in your overall marketing strategy.

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