How Loyalty Programs Improve Marketing And Customer Retention

Customer loyalty is a primary objective of every business. To achieve this, everyone works on developing their marketing management strategies and creating innovative marketing campaigns to reach the largest number of prospects. Loyalty programs are considered one of the most successful strategies in attracting and retaining customers and increasing their loyalty to your company. They are based on the principle of rewarding the customer for each desired behavior. In this article, we will learn about loyalty programs and how can a loyalty program helps in marketing management and customer retention.


What is a loyalty program?

Let’s start first by defining the loyalty program. Loyalty programs are rewarding programs that provide gifts to your customers for their loyalty to your company or brand. These rewards may vary to include exclusive offers and discounts on your services or products you provide as a reward for the customer for his repeated visits and frequent purchases with your brand.
These types of rewards programs help you retain customers, strengthen your relationship with them, and attract new customers who help your brand stand out. The loyalty program is also considered one of the most successful marketing strategies and the most profitable one because it is based on marketing and dealing with existing customers who have already bought from your company, So you will not find much difficulty in convincing them to come back again.
The loyalty program is also used by many famous brands and companies such as restaurants, airlines, supermarkets, clothing, and other various companies that aspire to increase and maintain customer loyalty.

Common types of loyalty programs:


1. Points Program:

The easiest and simplest loyalty program and is based on an easy principle. The more the customer spends, the greater the number of points he gets, and thus the number of his rewards increases. In this program, the customer gets a certain number of points whenever he buys from your brand or company. These points are later exchanged for rewards for the customer that includes exclusive discounts and offers to free products or services.

This program is considered the most popular and most used by major companies, as it is considered the most successful in loyalty programs. This is because it’s easy to apply and understood by the customer, which provides an easy and smooth user experience.
One of the most popular examples of this program is Starbuck Rewards offering points to users in every purchase.

2. Tiered Program:

This program is based on the principle of dividing customers into different tiers according to the rate of their spending and purchase from your brand. In this program, the customer gets points on every purchase and is graded at different tiers according to the number of his points, and the higher the level, the higher the reward value.
This program creates a sense of competition and urgency in the client, making him spend more to rise in levels and achieve better rewards. It also helps you attract new customers as well.
Example: Marriott’s loyalty program

3. Cashback Program:

It’s pretty much straightforward, Just like the points program, the cashback program is based on the principle that the more a customer spends, the more rewards he receives. But in this program, instead of the points that the customer gets cashback percentage in each purchase, and the higher the purchase value, the higher the cashback percentage.

4. Digital Punch Cards Program:

Buy 5 drinks and get the 6th for free!!
The good old punch cards, only digital this time. A program based on rewarding the customer for his repeated visits. This program is used more in restaurants, cafes, and shops. An easy and simple program that depends on giving the customer a point or a digital stamp on each visit, not when purchasing specific goods or services.
This program succeeds in increasing customer visits and retaining them and attracting new ones for its simplicity and ease. However, it may not be successful in raising the customer lifetime value CLV because it focuses mainly on the number of visits.

Example: Domino’s Pizza for frequent visits

How can a loyalty program help you retain the customer and manage your marketing campaigns


Retaining existing customers:

The loyalty program is considered one of the most successful strategies used by major companies to maintain their customers and increase the likelihood of them returning again. Not only that, loyalty programs also help in managing marketing and attracting new customers.
A Wirecard study showed that 75% of customers said they would buy again if they received a loyalty reward. Another study from Annex Cloud also showed that 63% of millennials and Gen Z will not commit with a brand that does not have a loyalty program. This means that customers of all kinds and ages will inevitably be attracted and maintained if you design a unique loyalty program for your brand.

Reducing costs for marketing campaigns and increasing revenue:

The loyalty program also helps reduce the costs of your marketing campaigns and increase your revenue by targeting your existing customers who are more likely to buy again than the new customer. As some studies have shown, the probability of selling to the current customer is estimated at 60-70% compared to the probability of selling to the new customer, which is estimated at 5-20%.
Having a loyalty program is a successful strategy to reduce the costs of your marketing campaigns as well, because, as we already know, it costs 5 to 25 times more to acquire and attract a new customer than to maintain an existing customer.
Also, increasing the rate of customer retention inevitably contributes to raising profits because the current customer spending rate is more. In addition, existing customers often suggest companies they deal with to their acquaintances, which also increases the rate of your attraction of new customers.

Collect customer information easily:

The loyalty program provides you with an easier way to collect customer information, phone numbers and emails, which are important information that helps you in managing your marketing campaigns and targeting them easily in the future. This is in addition to tracking the behaviour of customers and the services and products they love and using all this information to improve your marketing campaigns and make them effective. That is why you should think about loyalty program strategies that will inevitably help you in marketing management and customer retention.

Increase brand awareness:

Brand awareness is the first stage or step that the customer takes during his buying journey. That is why you should focus a lot on how the customers perceive your brand and your repetition among the competitors. Successful loyalty programs that receive positive feedback that help you a lot in increasing your brand awareness and reaching a larger segment of customers. In addition to improving your reputation among competitors and outperforming them.

With Resal boonus, you can apply these strategies now to make loyalty programs to retain your customers and increase their loyalty. In addition to improving your marketing campaigns and helping you manage your marketing more successfully. Here we offer you the best rewards solutions and loyalty programs out there. To help you keep your customers and attract new ones without breaking a sweat.

What are you waiting for? Visit the Resal boonus now and discover the exclusive offers and the great solutions that will enable you to maintain your customers and attract new ones with ease.

With resal boonus … rewarding has never been easier

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