Why is it best to implement customer loyalty program

Often it is argued that businesses with low margin cannot afford customer loyalty programs. While the program has been around since a while, there have always been certain doubts in the minds of business owners whether it would offer any advantage to the business. And, the most common myths linked to the loyalty programs are that it is very costly to operate them and a low-margin business may not afford it, it may be time consuming to implement them, and it does not go with less frequent purchased goods sectors.

This article will help you decide whether you should implement the customer loyalty management program in the business or not.

If you ponder over that loyalty programs would not work in businesses with low margins like grocery stores because they could not offer substantial rewards to their customers, you might be wrong. There are plenty of grocery stores which reward their customers with 1-2% of their total spent money. And, you are right when you say that such a minor percentage wouldn't bring customers back. Instead, it is the way individual offers are customized basis customers' shopping habits that takes off the business. The program directs more appropriate rewards for individual customers to gain their loyalty. The aim of every loyalty program is to bring customers back. And thus, the program works best only when you get to know your customers better.

Do not wonder about the time taken by the program to set up. There are many programs that are trouble-free and help you collect data effortlessly. Once you are done with data accumulation, you may always leverage them to increase sales.

If you are worried because of your business products that are not purchased by consumers frequently, then you might rethink. You may consider the way airlines have adopted this program. They initiated with introducing bonus points and credit cards to help their consumers avail the rewards and make the most of their vacations. In case you have a small business, then you may always partner with a large profit margin business or introduce one card to be used for all purposes. This will help consumers gain more rewards, and recommend the program to others too.

So, the next time before pondering over if you may afford the program, it is better to estimate first the cost that you are likely to spend when the program is not implemented in the business. Because an aptly designed program can certainly help you retain customers and increase sales eventually. 

Source : articlesbase.com