Businesses are about to enter the ‘golden quarter’ of the year – the festive period. The build-up to Christmas is always the key period of the business calendar, and the increased demand and sales made in these final 3 months can define the whole year for a business.

It’s a unique period of the year when the customer demand is at its highest, and there are plenty of unique customers who rarely shop with you but are looking for the perfect gift for friends, family, or work colleagues. Whilst they are not your typical target customer (think of how often a pensioner would visit a toy shop, for example), they still hold the same potential as other customers. As they are possibly just discovering your brand, you must figure out how to turn them into loyal and regular customers.

The Christmas period offers a unique opportunity to gain many more loyal consumers as you will meet a variety of different types of shoppers, from first-time buyers to lapsed customers to your loyal consumers. It is possibly the only time of the year when all three groups of people will come to you rather than you having to appeal to them. They want to buy, and you have what they want.

A customer loyalty program will help boost your revenue at Christmas and incentivise those customers to return, thus turning them into regular ones.

The different types of loyalty programme

When creating a loyalty programme, you are not limited to any traditional method, so if you are planning on introducing a unique loyalty scheme that is the perfect fit for your business, then you have the capability. However, the three most popular types of loyalty schemes are points per pound, points per transaction, and points per visit.

Points per pound

Simple but effective. Customers enjoy this method as it is easy to understand, and they know that what they spend helps them earn points. This method benefits your business and marketing opportunities, and you gain data on your highest and lowest pending consumers as well as their frequency of spending – meaning you can offer incentives that are relevant and suitable to them.

Points per transaction

This type of scheme is most suitable for fast-moving businesses with regular repeat consumers, for example, a coffee shop or bar. A typical points-per-transaction scheme is buy 10 and get 1 free. Traditionally this is done by handing out stamp cards, but Reward-It’s digital loyalty system allows you to collect consumer data whilst still implementing a points-per-transaction system.
Whilst this doesn’t give you in-depth information like a points per pound method – such as spend amount and average order value – it does promote loyalty with your customers and is incredibly simple to set up.

Points per visit

This loyalty scheme is geared towards entertainment venues rather than consumer products. For businesses like leisure centres, sports clubs, nightclubs, bars, and restaurants, to name a few, you can reward customers just for visiting.

It is simple to set up and easy to use, and our software can limit the number of points awarded per day, so if a customer decides to go outside and back in again to earn an extra point, the software will recognise it and prevent the transaction.

This loyalty scheme is ideal for monitoring customer frequency but won’t track their spend.

How loyalty programs boost revenue

Christmas is an incredible opportunity to turn brand-new or less frequent customers into regular, loyal consumers.

A loyalty programme is an added bonus for your customers. They are being rewarded for their loyalty to you, which helps persuade them to return to your business. The modern consumer is used to comparing and looking for the best deal for their shopping needs. A customer loyalty programme adds value to the customer’s purchase, thus influencing their decision to spend with you instead of your competitor.

By rewarding your customer for choosing to spend their money with you, they will feel engaged with your brand and service or products and will become more likely to refer you to their friends and family, increasing positive word-of-mouth marketing.

By offering a loyalty rewards scheme, you encourage your customers to become repeat visitors and help turn their choice of your business into a habit whilst continuously enforcing a positive experience and your brand values.

Research shows that 84% of customers say they’re more likely to stick with a brand that offers a loyalty program, and 66% say that the ability to earn rewards changes their spending behaviour.

A loyalty programme can offer your business a digital presence. By opting to use a dedicated app, your customers always have a permanent reminder of your brand about their person and can see regular updates, rewards and offers. They can also use the app as a digital loyalty card and link a physical card if they want to use both.

You can look at this from a different angle: if your competitors have a loyalty system and you don’t – who will your potential customer be more likely to choose?

How does customer loyalty increase revenue?

Research conducted by Frederick Reichheld of Bain & Company states that increasing customer retention rates by 5% and increases profits by 25% to 95%.

By encouraging customer loyalty, you nurture the brand-customer relationship and encourage them to become meaningful, lifetime customers.

Increased loyalty means increased trust between them and the brand – which provides access to any relevant data you require, from spending frequency, spending habits, the average order value, and when they purchase. All this data can be used to provide more targeted marketing, which improves the relationship between the two parties. This is crucial to the success of your marketing plans, as a customer is more likely to open an email if the information is tailored to them.

All of this improves the customer’s sense of belonging and appreciation by the brand – which in turn encourages regular, return custom.

Look after your loyal customers by rewarding them for continued use of your brand and services. They offer regular income and are highly likely to recommend you with word-of-mouth or social media mentions, turning them into brand advocates.

One thing to consider when deciding to implement a loyalty scheme is cost. How much does it cost to reward a loyal customer, who will keep returning to your business, versus how much it costs to acquire a new customer and the risks associated with them becoming loyal brand advocates or not?

How do loyalty schemes attract customers?

The modern consumer has more access to alternatives than any other generation of consumers. They are savvier with their spending and will put more research into their buying decisions than ever before.

Because of this, it is vital that your business offers added value and incentives to entice them.
With Christmas offering the opportunity to acquire new customers, you must show that your business is one worth spending with and investing with. If you capture them the first time and prove you are worth their loyalty by providing a high-quality service, they can be turned into loyal and regular consumers that provide a high level of lifetime value.

A recent study by Rare Consulting says that, according to 83% of customers, loyalty programs make them more likely to continue doing business with certain companies.

Customer loyalty programs play a huge role in retaining customers. In this highly competitive market where customers quickly switch their service providers or suppliers to another after facing any inconvenience, such as poor service or cost, customer loyalty programs show the way.

There are several statistics that prove the significance of customer loyalty programs and how instrumental they are in consumer purchasing decisions:
• 69% of customers say that loyalty programs influence their choice of retailer.
• 57% of customers join loyalty programs because they want to save money, while 37.5% go for it to receive rewards
• 50% of customers say they would change their behaviour to attain a higher tier of the customer loyalty program.
• 76% of customers believe that loyalty program strengthens their relationship with brands.

A simple and inexpensive way to nurture and retain long-term customer value and increase profits, a customer reward system is a proven method of improving customer loyalty and positive brand identity and relationships.

The Christmas period is the busiest of the year for the majority of businesses. It is unique in the fact that you have customers actively looking for you, ones that potentially won’t be throughout the year. This means it is the perfect opportunity to capture and retain them, transforming them into long-term and loyal brand advocates.

For all the information you need on setting up a customer loyalty system, including software, card printing and more, please contact us here.