How to choose a loyalty program? All options can be classified by 3 criteria:
Mechanics
Reward
Level
In terms of mechanics, a loyalty program can be
General
Segmented
Trigger
The general program applies equally to all clients without any restrictions. Anyone can become a member, and they will receive the same privileges as everyone else.
Example: a store discount card providing a 10% discount.
A segmented program is aimed at a specific category of clients — it provides them with additional privileges. But first, you have to segment.
Example: increased points for women from March 6 to March 10.
A trigger program involves accruing bonuses when a client fulfills a certain condition.
Example: free delivery with a purchase of 990 rubles or more.
In terms of rewards, the loyalty program can be
Discount
Cumulative
Affiliate
Paid
Intangible
The discount program assumes receiving a discount on subsequent visits. This discount can be fixed or floating. In the second case, it can increase with an increase in the amount of purchases.
Example: a gas station discount card providing a discount of 3% to 5% when filling up a car.
The main tool of the savings program is points awarded for a purchase. These points can then be spent on purchasing other goods, services, etc.
Example: cashback in the form of points in the amount of 10% of the purchase amount, credited to the loyalty card. Using points, the client can pay up to 30% of the cost of the goods.
A partner loyalty program is a collaboration with other brands, within which the client can spend money in one company and receive a reward in another.
Example: points accrued for purchases by card, which can be spent in partner stores, exchanged for promo codes, etc.
A paid loyalty program involves the client paying for access to certain privileges, such as exclusive goods or additional services.
Example: a paid subscription that extends the warranty period, increases the return period, allows free shipping, etc.
An intangible loyalty program does not provide any material rewards to the client, but allows for the satisfaction of social needs. Within its framework, potential rewards are directed to charity.
Example: every 10 rubles received from a buyer are directed to a charity fund.
Finally, the loyalty program can be categorized by level.
Single level
Multi-level
A single-level loyalty program does not provide additional privileges for customer actions. The reward is fixed regardless of the volume of purchases or their frequency.
Example: a permanent 5% discount on a purchase.
A multi-level program offers additional rewards depending on the client's activity. The more often they buy, the more they spend, etc., the greater the reward.
Example: a discount card with a floating discount: for purchases of 10,000 rubles per month, the discount is 5% (for a year), for purchases of 20,000 rubles - 7%, for purchases of 30,000 rubles - 10%.
If the customer base is large enough, then it makes sense to remind them with notifications, emailor a voice assistant that the client's discount has increased or there are 3 months left before the discount is reduced.
Which of these to choose depends on your goals, business characteristics and other factors. If you have difficulty choosing, try to analyze the loyalty programs of competitors in your field. You can adopt their ideas and adapt them to your needs.
What mechanics will help improve the loyalty program and reduce costs
Choosing a specific loyalty program is only half the battle. In order to achieve maximum customer loyalty and reduce costs without much damage to reputation, it is necessary to improve the loyalty program. Ideally, first prepare tools such as sms api and integration with the marketing automation platform, through which all communication will be conducted. The following mechanics will help you further:
1) Combining conditions
Above, we looked at 10 loyalty program options. But this does not mean that you need to choose just one. You can combine the terms of rewards from different loyalty programs. For example, a loyalty program may include:
Discount from X% to Y% depending on the purchase amount;
Increased discount for certain categories of customers during holidays;
Paid subscription that provides 10% cashback in points and free shipping.
When combining conditions, consider the costs you will receive. Also, try not to complicate the loyalty program - the client is unlikely to spend time to understand all the intricacies.
2) No plastic
In the usual understanding of the client, a discount mongolia business email list card is a plastic card with a magnetic strip, chip or unique barcode. This is necessary for identifying the client. However, a physical medium is not required here. You can accrue and write off points, for example, by phone number. This is more convenient for the client and more profitable for you.
3) Bonuses for inviting friends
Inviting friends is a popular trigger for providing a reward to a user. It allows you to get another client without any additional effort on your part. A good example of such a mechanic is a bonus of 1,000 rubles and free service at Tinkoff. If a debit card is issued using your referral link, you will receive 1,000 rubles in your account, and the new client will receive free service forever.
4) Reward Shop
You can create a special store with unique products - for example, branded stationery, clothing, subscriptions, etc. Customers will be able to buy these products only for points accrued within the loyalty program (there is no other option). This will strengthen the attachment to the brand, and also give you additional advertising.
5) Bonus conversion conditions
You give your customers bonus points for purchases. In what ratio will they be converted? The simplest mechanics are 1 to 1 (1 point = 1 ruble).
But in some cases, it is much more profitable to use more complex calculation mechanics. For example, points are awarded in the amount of 5-10% of the check amount, but are converted in the ratio of 10 to 1 (10 points = 1 ruble). Simply put, the "cashback" will be 0.5%-1%, but the client will see a more attractive figure.
6) Minimum threshold and rounding
Let's try to remember how cashback works at most banks. Let's assume you get 1% of all purchases. Accordingly, if you spend 90 rubles, you will get 90 kopecks, and if 1290 rubles - 12.9 rubles.
No way! Most likely, in the first case you will not receive anything at all, and in the second case the cashback will be 12 rubles. The fact is that banks introduce a minimum threshold for the purchase amount from which cashback is accrued. At the same time, a step of 100 rubles can be set for its accrual. As a result, it turns out that the loyalty program works, but the bank saves on it.
Such mechanics allow to reduce expenses for the loyalty program. But at the same time it does not harm the company's reputation - does anyone really complain that the cashback turned out to be 90 kopecks less?
7) Limits
Let's say a loyalty program involves earning and using points. How many points can you spend at a time? Some companies set limits, such as:
Minimum amount of points to write off (for example, write off from 100 points);
The maximum amount that can be paid with points (for example, no more than 30% of the product price).
Why do you need this? It's simple - you encourage customers to buy more often to accumulate points faster, and also protect yourself from unnecessary expenses.
