Benefits to small business of Gift and Loyalty Programs
There are many benefits for small businesses who offer a gift and loyalty program. After all, if a customer is loyal to a business, shouldn’t that business, in turn, be loyal to that customer? Let’s discuss why you should consider a gift and loyalty program for your customers. Afterwards, we will offer a few program ideas to help get you started.
Why you should offer a gift and loyalty program to your customers
- To retain business – If a customer can get the same product that you’re offering at a different store, why should they choose your place of business over the other? Answer that question for them by offering them a reward for being a patron. Who doesn’t like to be rewarded for shopping?
- To earn trust – Gaining the trust of your customers can be an important part of customer retention. Like any other relationship, trust is key. If customers learn that they can trust you to follow through on what you say you will do (ie, you honor the reward program you have set in place), they can then start to respect your business and respect you as an authority in that business.
- To gain a profit – We all know that you shouldn’t have to pay money to make money, but sometimes that’s just what you need to do. In instances where the “money” you’re paying for a customer’s loyalty is in the form of a gift card or store discount, you will likely recoup that cost when the customer returns to use their reward. (How many times have you received a discount or coupon from a store, and ended up purchasing more than the value of the coupon?)
Gift & loyalty programs you can offer your customers
- Get $X when you spend $Y – Offer a simple reward program based on the customer’s amount of purchase. For example, for every $20 the customer spends with you, you will give them a $5 gift card.
- Earn points for purchases – Give customers a card that they can scan with every purchase to gain points (ie, 1 point per $1). Then, offer rewards based on point amounts. This gives the customer the option of using a few of their points for lower-cost rewards, or saving up more points for higher-cost rewards.
- Business card raffles – Set out a bowl for customers to drop one of their business cards in. At the end of every week (on Friday for example), have a drawing for a gift card ($5, $10, the amount is up to you). After the drawing, take all the business cards and pin them to a bulletin board as advertisement for your customers. Free advertisement for them, repeat customers for you.
If you have any questions or comments about starting a loyalty program, please contact us. We are here to help you with all of your business financial solutions.