With growing competition, it is becoming increasingly difficult for businesses to retain customers, employees and partners in order to build a long-term sustainable relationship. Loyalty programs are strategic initiatives adopted by a business to encourage key stakeholders to remain loyal and not to pursue other avenues.
Most often, they are adopted by businesses to keep customers returning to their store. The way it works is rather simple. Customers who shop more frequently are entitled to more rewards in the form of gift vouchers or even merchandise. When these programs are intelligently devised, it helps to build brand value and sets the company apart from others in the market. It’s a common fact that it’s easier to sell to an old customer rather than find a new one. Thus, this is one way of increasing revenue from within the existing customer base.
Loyalty programs can also be developed to build stronger and more fruitful relationships with employees. A strong and loyal workforce is a tremendous asset to any firm and can positively affect business returns. The growth of social media and online job portals has increased the rate of attrition across industries. Companies need to create customized loyalty programs that can keep their teams motivated, productive, focussed and excited about fulfilling company objectives. It may come in the form of public recognition, financial increments or even a fully-paid holiday.
There are numerous organisations that have adopted loyalty programs for trade and business partners. Not only does it solidify the relationship but it builds an emotional connect. Whether the rewards are linked to sales, timely deliveries, referrals or other parameters, these programs help initiate dialogue between parties and thus facilitate meeting mutual objectives. Rewards may come in the form of transaction-based discounts, invites to member events, free merchandise and more.
Today, there is no doubt that loyalty programs can boost revenue and create lasting brand value. The best brands are built through word-of-mouth marketing. Rewarding your employees, customers and partners can go a long way in strategically revolutionizing your business.