How Your Small Business Can Use Loyalty Programs to Retain Customers

Small businesses can use customer loyalty programs to improve retention, drive business

You’ve invested blood, sweat and tears, not to mention time and money, into building your small business. You’ve developed a customer base and are growing. Now – how do you keep that customer base loyal? Try a rewards program.

Customer retention is more important than ever in the digital age, when consumers have plenty of options at their fingertips for goods and services. And loyalty programs for small businesses must go beyond just a punch card in a wallet.

Consider leveraging technology

Today, small businesses can employ a variety of free, or fee-based, digital tools and apps to create customer loyalty programs. Among the most popular fee-based apps are Belly and Spendgo which allow customers to use mobile devices to win prizes, accrue store credits or enjoy cash-back rewards when they make purchases. Loyal customers can receive special benefits ranging from discounts on future visits to first-look access to new products and one-time special offers. Free options include loyalty app Loyera, and FourSquare, where business owners can offer customers deals for checking in. The use of QR codes is another free option that can make a big impact. Small businesses can customize rewards and customer loyalty programs to their own specifications, giving them complete control. The best loyalty programs and apps also allow for social media integration, business owners can recognize and reward customers for being active on the company Facebook, Twitter or Instagram feeds. Consider offering redeemable points, discounts or other rewards to customers who provide feedback on a product or service through likes, shares or online reviews.

At the same time, small businesses can use data generated by apps to track customer trends, such as favorite products, which discount offers they’ve redeemed in the past, how much they spend on average, or their preferred bricks-and-mortar location. Future offers can be tailored to customers with a higher degree of accuracy, giving customers exactly what they want.

Engage further with personalization

Consider using your loyalty program to help collect information about your customers that will allow you to market more directly to them and make them feel special. For instance, by collecting a customer’s email address, birthdate and anniversary, small business owners can send a customer a happy birthday greeting with a special offer, or engage them on an anniversary. The personalized options are virtually limitless.

While personalization and engagement are key, so is moderation. App notifications can turn quickly into spam if you bombard customers with constant messaging and alerts. Think strategically about reaching out. Messaging should be brief, catchy and written clearly. Give customers control over opting into notifications – not all customers want to engage. For those who do, make sure your app has a quick contact button so customers have a way to reach your business at their leisure.

Finally, make sure the app you use for your loyalty programs is always up to date. Just like a website, apps bogged down by glitches, that lag or look outdated can frustrate customers and turn them away. It tells them you’re ambivalent about their digital experience with your business.

Have you had any success with loyalty programs? What were your biggest challenges? We’d love to hear your story! Be sure to follow us on Facebook, Twitter, LinkedIn, and YouTube, and join the conversation.

The information provided is intended to provide a general overview. This information is not legal advice and should not be relied on as such. EMPLOYERS® makes no warranties as to the accuracy, adequacy, or completeness of the information provided, and will not be responsible for any actions taken based on the information contained herein. If you have legal questions or need legal advice, please consult an attorney.