Want to Sell More? Try Customer Loyalty Programs
“I get it,” Zoot said. “Maybe each $1,000 Drachmas our customers spend gets them $10 off a future torch purchase. Maybe once they spend $10,000 Drachmas, they get 10 percent off all torches for the year—or 50 percent off our ‘loss-leader’ TorchBuddies product.”
“You touched on an important point,” Marka noted. “To ensure rewards are in line with level of loyalty, let’s make this program tiered. Everyone who joins the program gets a nominal reward just for signing up, say a few bucks off a torch or two. As customers move up the ladder, we increase the reward’s value.”
“We could have Bronze, Silver and Gold tiers—just like the Olympics!” Zoot exclaimed.
“Sure,” Marka said. “Finally, don’t forget that many of the most valuable rewards we can give customers aren’t financial. Bronze members might get a subscription to Fire Buyer’s Weekly and a ham every Olympians’ Day. Silver members might get a membership to the Torch of the Month Club, and free expedited shipping. And Gold members could get everything the Silver and Bronze members get, plus priority scheduling and a 24-hour VIP customer service line. All these perks are as valuable—if not more so—than actual Drachma discounts.”
“I can practically see our share-of-customer growing,” Zoot raved. “Now...about that froyo.”
Today’s FIRE! Point
It’s much easier to get more business from existing customers than to sell to new ones. Consider giving customers a real incentive to do more business with you by offering a loyalty program that provides perks, discounts and other benefits to your customers.
FIRE! in Action: Mongolian Barbecue Uses Customer Loyalty Programs to Bring in Bigger Spending Diners
The restaurant sent a variety of promotions to existing customers that encouraged them to return—from free desserts to free gift cards for their friends. These campaigns have achieved high open, redemption and referral rates.