As a POS system service and support provider, we often
receive requests from our customers on setting up reward programs.
Reward programs can be more effective than
other types of promotions
because
they foster a long-term relationship as compared to coupons or discounts.
A good rewards program creates customer
loyalty by offering your customers what they need, thus generating value for
your customers to keep coming back.
Here
are some tips on getting the most out of your reward programs.
First, you need to decide the objective of the reward
program. Some programs aim to get new
customers through referral, others are based on dollars spent or the length of
time a customer has been shopping in a store.
For retail stores that rely on high frequency, you may want to lean
toward a program that rewards the number of transactions or dollars spent.
Second, you want the reward program to target the right
people, your top 10% frequent shoppers.
To know this group, you want to gather information on what they buy,
when they buy, how often they buy and what rewards they would value. Data from your POS system along with the
right analysis will show you this information.
Of course, you do not want to neglect attracting new customers either.
Thirdly, your reward program should offer something that is
tangible and a goal that is easy to reach.
You should design your data gathering and reporting methodology to get
the information from your POS system so you could offer rewards that are
meaningful and obtainable to your top customers. When done right, the reward will create
excitement among your customers. When
they reached the point of redemption, you want to make the redeem process easy.
For any reward program to generate any buzz, you need to
reach out to as many customers as possible. Use multiple avenues to spread the word.
Lastly, check out what your competitors are doing. Learn from what they did right or wrong and use
this knowledge to create a competitive edge.
It is simple for any retailer to offer a reward
program. However, with careful planning
and the right execution, you could create a reward program that truly generates
customer loyalty and attract new customers to help your business grow.