Many entrepreneurs tend to doubt the profitability of loyalty programs. Some believe that these programs are useless because they almost never guarantee a return in monetary terms, while others even consider them a reduction in the profits they should be obtaining. This leads to the question: are loyalty programs really profitable?
According to research by Accenture, by 2023, 90% of companies will have a loyalty program that, in one way or another, will have borne fruit. Loyalty programs are very profitable, more than most people realize. The proof is in the numbers: according to statistics from ExplodingTopics, the loyalty market will be worth $4,43 billion in 2023. However, it turns out that many brands have not seen the impact because they have failed to do it the right way.
So if it’s worth investing in, then it’s worth doing it right; if this concept isn’t applied when you take care of creating these programs, the results will never be what you expect. This article explains how to ensure that your loyalty programs get the results you want.
Experts from promo-codes.it share some techniques to help you get the most out of your loyalty programs and increase their success rate.
Push on slow-moving products
With or without incentives, sales will be made on fast-selling products. Fortunately, brands do not need to do much to sell these products. However, other product categories remain in stores longer than others. This does not mean that these products are substandard or of lower quality. It could simply mean that they are not a priority for customers at that particular time.
These are the products that the target audience should be motivated to buy, through coupon codes or other types of promotions. In this way, the impact of the discounts will be more easily measurable and perceptible, since it is a good incentive to convince customers to buy items that they may not need at that moment.
Promotions for days with less attendance
Every brand has off-peak days and peak periods. You can’t get the same sales volumes every season and every day of the week. Depending on what your brand offers, there will be days when you’ll have massive sales and other days when you won’t have any. Loyalty programs are a great tool to increase sales on off-peak days. You can get even more sales than expected by offering discounts and special promotions on these days.
Referral Bonus
Offering incentives to customers who refer you is one of the best ways to maximize your loyalty program. While offering bonuses in credits or even real money to these customers has been proven to be much cheaper than bringing in new customers yourself. Since the marketing effort is not coming directly from an unknown brand, but from a trusted friend who has already tried it, it is much more likely that this new person will trust the brand enough to make a purchase.
Zendesk’s Customer Experience Trends report also found that over 70% of new customers tend to trust word-of-mouth referrals from friends and acquaintances who are familiar with a brand’s services, more than any traditional advertising. By offering referral bonuses to customers, they will be more motivated and will do more to speak highly of your brand.
Article published on 21 April 2023 - 10:52
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