What is a loyal customer? What is a customer loyalty program?

Loyal customers

Loyal customers are people who continually choose your business's products or services. They have a trusted relationship with your brand over many years, often making large transactions. To encourage and show gratitude for this loyalty, applying a reward policy and appropriate incentives for them is necessary.

Program for loyal customers

Loyalty programs are businesses' efforts to build a close "bridge" with customers, thereby encouraging them to continuously use the company's products or services. To do this, a loyalty program needs to focus on building a "long-term strategy" to establish long-term interactions and relationships with customers, not just on increasing sales. sell right away.

>>>> Read more: The Power Of Customer Relationship Marketing

Benefits of the program for loyal customers

Build a real emotional connection 

Loyalty programs always focus on personalizing each customer's experience, bringing unique core values. Once they become loyal customers, they will enjoy exclusive perks based on their membership tier. This helps them feel special and important to the business.

The loyalty program also allows them to be the first to experience new products and always have information about the earliest promotions, as well as enjoy attractive offers exclusively for customers. member.

Tools to help boost sales

Thanks to the emotional connection and customer satisfaction, customer loyalty programs can boost their return rate by up to 54%, according to annexcloud.com.

Loyal customers often stay with a business longer and have a purchase rate about 67% higher than new customers. Therefore, they contribute an important source of revenue to businesses when implementing customer loyalty policies well and effectively.

Help businesses promote their brands

With loyalty programs, businesses can expand their customer base by encouraging members to refer their friends and relatives to the program.

Furthermore, offering incentives to customers when they write product reviews or submit feedback is also an effective way to build trust with other customers. Businesses can also encourage customers to share their experiences at the times and products they feel most satisfied with during their participation in the loyalty program.

Strategies for building customer loyalty programs

Accumulate points, discounts, give vouchers/coupons 

This method may be quite common and not too complicated, but it can be very effective in building relationships with customers after they use the service. Customers are rewarded with points after each purchase or receive discount vouchers to use for future purchases. They can also track their reward points through their membership card, online account, or mobile app.

The strategy of accumulating points has become very popular, not only in the Food & Beverage sector such as coffee chains like Highlands or The Coffee House but also on e-commerce platforms such as Shopee, Lazada, Sendo, etc.

Pros:

• Simple and easy to deploy
• Attract more customers to participate easily
• Low risk

Cons:

• Doesn't make much difference compared to many other brands on the market.
• Only create short-term connections with customers.
• If you overuse discounts or give away too many coupons and vouchers, it can affect the brand's image.
• Customers may develop the habit of only buying when there is a discount.

Cash back program when shopping

A cashback program is a form of returning a portion of the money to customers after they purchase a product and make a payment. Although popular globally, this program has only appeared and developed strongly in Vietnam in recent years. Cashback currently has two main forms:

• Credit Card Refunds: Shopping sites often tie up with banks to offer refunds to customers when they pay with a credit card. Some banks also issue special credit cards for customers to receive cashback.
• Refund via e-wallet: Customers can use e-wallet to pay when purchasing wallet-enabled products. E-wallets such as Momo, Airpay, and Zalopay often have attractive cashback promotions for customers when making purchases on platforms such as Shopee, and Lazada, or paying other bills.

Pros:

• Similar to the point accumulation program
• Easy to join and understand
• Increase the ability to attract customers to make repeated purchases
• Collect customer information easily

Cons:

• The time to receive incentives may be longer than the points accumulation program
• Not attractive to customers who do not shop often
• Doesn't make a big difference compared to many other brands on the market

Customer loyalty program

With this program, businesses will establish a hierarchy for members, each hierarchy will have separate benefits, features, and special gifts. Customers need to complete "missions" to achieve these rankings.

Pros:

• Create long-term relationships with customers.
• Create a feeling of importance for customers: When customers belong to a higher hierarchy and receive special gifts only for that hierarchy, they will feel "status" and importance.
• Make the program different and interesting, making the brand stand out from the crowd.

Cons: 

• Requires a highly qualified technical team to build and manage the program effectively.
• Don't drive interest from lower-ranked customers who don't shop frequently.
• It is necessary to build the program to be as simple and easy to understand as possible, to avoid making customers feel discouraged when starting from a low level.

Notes to organize an effective customer loyalty program

Research your customers, make sure you understand your customers 

To successfully implement a customer loyalty program, it is important to first research and understand the customer base. You can not only create effective customer loyalty programs by collecting and analyzing data accurately, but you can also improve your products or services. All of this goes towards the goal of delivering an excellent customer service experience.

Create simple, easy-to-understand programs

If you make your loyalty rewards program too complicated, it can lead to misunderstanding or reluctance on the part of customers to participate. This may cause them to forget about the program or not be interested in it. To avoid this, it's important to make the sign-up process and loyalty program rules easy to understand and customer-friendly.

Rewards and gifts must bring value to customers 

The rewards you offer need to make financial sense for your business, meaning they shouldn't be extravagant gifts that cost too much. However, at the same time, it is necessary to ensure that the reward is valuable and satisfies the needs of the customer.

Whether you choose to offer customers a discount on future purchases, a free reward, or a combination of both, always remember one important rule: The reward must provide value to the customer.

Stay connected with customers

It's important to stay in touch after implementing a loyalty program. Businesses can use Email Marketing campaigns, SMS Marketing, or online chat to maintain the connection with customers.

Implement multi-channel marketing 

No matter how great your program is, if customers don't know about it, it won't be successful. Investing in multi-channel marketing to increase customer awareness of the program is important. Here are some ways you can do it:

• Online advertising, via the Internet.
• Use social networks such as Facebook, and Zalo
• Create press or news releases.
• Advertising in media such as newspapers.
• Use outdoor advertising.
• Create in-store signage or informational flyers.
• Send customer satisfaction surveys.
• Use email marketing and send newsletters.

Customers expect personalized and consistent experiences across multiple channels when they use them to reach businesses. And if they don't get a consistent experience, they will be upset and may turn away from other brands.

StringeeX's Omni-channel contact center is ready to support comprehensive multi-channel interaction to help bring a consistent, seamless customer experience.

The system helps unify all popular connection channels (voice call, video call, chat, email, SMS, Facebook, Zalo) into one interface, helping employees easily interact and process customer feedback on one screen. unique software.

Build exclusive incentive programs for loyal customers 

Focus on keywords like "unique," "exclusive," and "just for you." will help your customers feel like they are an important part of your business. And as a result, they will recommend your business to friends, invite others to join your email list and follow you on social media platforms.

Final Thoughts

Overall, a loyalty program is an effective activity that helps businesses strengthen relationships with their customers, thereby promoting customer interaction and satisfaction. By combining loyalty programs, specific offers, and personalized event experiences, businesses can create a more optimized customer experience. This helps boost business, increase customer loyalty, and increase overall revenue.