Loyalty Program: How to Retain Customers and Increase Repeat Sales
Posted: Thu Dec 26, 2024 4:40 am
We tell you how an online store can avoid falling into a promotional trap and bring customers to repeat purchases
02.05.2024 ⏱ 9 minutes
Loyalty Program: How to Retain Customers and Increase Repeat Sales
Sales lose their effectiveness over time. This happens if you give big discounts at least once a season. Customers get used to prices that are favorable to them and wait for the store to reduce the cost, while the store itself falls into a promotional trap. A well-thought-out loyalty program will help you get out of it.
We explain what it is, why a loyalty program is needed for a kuwait phone numbers business, and what you need to consider when launching it.
What is an effective loyalty program in practice
What is a loyalty program and why does a business need it?
What types of loyalty programs exist?
How to evaluate the effectiveness of a loyalty program
Checklist: how to launch a loyalty program
How to set up and launch a loyalty program in ReatilCRM in 30 minutes
Let's consolidate
What is a loyalty program and why does a business need it?
A loyalty program is a reward and incentive system that allows you to retain customers and motivate them to make purchases. A loyalty program works like this: a customer receives a reward in the form of bonuses or discounts for an action that the store needs, such as purchasing a specific product, inviting a friend via a referral link, or installing an application.
According to statistics from RetailCRM business analysts, the growth of loyalty program participants among our clients in 2023 was 64%. In e-commerce, the figure is even higher - 74% of online store buyers used loyalty programs.
74%
of customers used loyalty programs
Customers have begun to use loyalty programs more often
The 2023 trend in retail and e-commerce is that customers are using loyalty programs more often
A loyalty program is a marketing tool that helps businesses solve several problems:
1. Attract and retain customers. This can be achieved with additional bonuses and discounts for purchases, such as points for New Year or birthdays.
2. Increase the average bill. Customers make repeat purchases more often and spend more money to earn bonus points or get additional discounts.
3. Increase loyalty. Participation in the program creates a sense of belonging to the brand in customers and strengthens their trust in the company.
4. Collect customer data. Welcome bonuses or points for registration data will enrich the customer base, help segment the audience and more accurately customize marketing campaigns.
5. Stimulate sales in the off-season. With the help of a loyalty program, a company can stimulate sales during periods of decline in demand by offering customers additional bonuses or discounts.
But a loyalty program also has its downsides. For example:
1. It is expensive to implement. You will have to pay not only for the loyalty program, but also for the development of mechanics, automation of business processes, implementation and support.
2. A loyalty program is not always effective. Some customers are not interested in such attraction mechanics. For example, buyers may not see the value in this or rarely buy in your store.
3. The result is not immediately visible. A loyalty program is a long-term story. It is not built immediately, but by trial and error - this will take time. You need to constantly test mechanics and see which ones work and which ones do not.
What types of loyalty programs are there?
Most often, businesses use the following mechanics:
Bonus.
Discount.
Multi-level.
Paid subscription.
Cashback.
Bonus. For each purchase or target action, the store accrues bonuses to the client as a percentage of the purchase. Most often, one point is equal to one ruble - but there may be another system. For example, clients of the healthy food store Ruketo receive from 2 to 10% depending on the purchase amount. The higher the purchase amount, the more bonuses the client receives. Accrued points are available for six months, and then expire. This motivates clients to buy faster.
Case Ruketo: “If there is no loyalty program, it is very difficult to stay on the market”
Loyalty program from M.Video
When purchasing in the M.Video online store, in addition to bonus rubles, you can use a personal discount. It is different for each client and depends on the purchase history
Customers can spend points in different ways - only on the website, only in offline stores, or both. For example, in Samsonite you can buy a suitcase in the online store, get points there, and then spend them in the showroom or vice versa. Bonuses can be used to pay up to 30% of the purchase. If it is a discount store, up to 10%.
How the loyalty program is organized in the Samsonite store
Loyalty program from TOY69 store
An example of the loyalty program of the Toy69 store. Customers see information about points in their personal account. A pop-up banner will briefly tell you how points are awarded and how to spend them
Customers at the Madrobots online store are credited with madcoins, which can be used to pay for their next purchase.
Loyalty program from Madrobots store
The balance of madcoins is displayed in the personal account of Madrobots. One madcoin is equal to one ruble
Discount. The store gives the customer a fixed or cumulative discount - the more you spend, the bigger the discount. In an offline store, customers present a discount card or code from the app. When shopping online, the discount is displayed in your personal account on the website and is applied automatically
KaramelkaShop Case: “Meter-long stacks of hundreds of orders were reduced to 3 clicks, and the bounce rate was reduced by 10% in the first month”
Loyalty program from Karamelkashop store
Karamelkashop has a loyalty discount program - the discount increases proportionally to the amount of purchases
Multi-level. At the start, the client is given a minimum bonus or cashback, which then increases with the growth of the purchase amount. For example, the Toy69 store gives each new buyer 5% cashback on all products and 3% on promotional items. As purchases grow, so do the privileges. When the client buys for 300,000 rubles, the cashback will become 30%, and 15% will be credited from promotional items.
Loyalty program from TOY69 store
The Toy69 store has four levels of loyalty program. The first level has a minimum discount, and by the fourth level it increases
"Multi-level loyalty programs work better thanks to the gamification element. It can be played out in a cool way and involve the client in the process of moving through the levels so that he strives to reach the end and get the maximum discount. The
main thing to remember here is that the client needs to be involved and supported with communications. For example, highlight how many points he received from the purchase, how many have burned out, or how many are left to collect before moving to the next level."
Violetta Danylchyk
Violetta Danylchyk
Head of CRM Marketing at Radis
Pult.ru also has a multi-level loyalty program, but it is more complex. Clients start with the standard level and a 3% discount. When the purchase amount reaches 150 thousand rubles, the client moves to the next level with a 5% discount and so on until he reaches the maximum - diamond.
02.05.2024 ⏱ 9 minutes
Loyalty Program: How to Retain Customers and Increase Repeat Sales
Sales lose their effectiveness over time. This happens if you give big discounts at least once a season. Customers get used to prices that are favorable to them and wait for the store to reduce the cost, while the store itself falls into a promotional trap. A well-thought-out loyalty program will help you get out of it.
We explain what it is, why a loyalty program is needed for a kuwait phone numbers business, and what you need to consider when launching it.
What is an effective loyalty program in practice
What is a loyalty program and why does a business need it?
What types of loyalty programs exist?
How to evaluate the effectiveness of a loyalty program
Checklist: how to launch a loyalty program
How to set up and launch a loyalty program in ReatilCRM in 30 minutes
Let's consolidate
What is a loyalty program and why does a business need it?
A loyalty program is a reward and incentive system that allows you to retain customers and motivate them to make purchases. A loyalty program works like this: a customer receives a reward in the form of bonuses or discounts for an action that the store needs, such as purchasing a specific product, inviting a friend via a referral link, or installing an application.
According to statistics from RetailCRM business analysts, the growth of loyalty program participants among our clients in 2023 was 64%. In e-commerce, the figure is even higher - 74% of online store buyers used loyalty programs.
74%
of customers used loyalty programs
Customers have begun to use loyalty programs more often
The 2023 trend in retail and e-commerce is that customers are using loyalty programs more often
A loyalty program is a marketing tool that helps businesses solve several problems:
1. Attract and retain customers. This can be achieved with additional bonuses and discounts for purchases, such as points for New Year or birthdays.
2. Increase the average bill. Customers make repeat purchases more often and spend more money to earn bonus points or get additional discounts.
3. Increase loyalty. Participation in the program creates a sense of belonging to the brand in customers and strengthens their trust in the company.
4. Collect customer data. Welcome bonuses or points for registration data will enrich the customer base, help segment the audience and more accurately customize marketing campaigns.
5. Stimulate sales in the off-season. With the help of a loyalty program, a company can stimulate sales during periods of decline in demand by offering customers additional bonuses or discounts.
But a loyalty program also has its downsides. For example:
1. It is expensive to implement. You will have to pay not only for the loyalty program, but also for the development of mechanics, automation of business processes, implementation and support.
2. A loyalty program is not always effective. Some customers are not interested in such attraction mechanics. For example, buyers may not see the value in this or rarely buy in your store.
3. The result is not immediately visible. A loyalty program is a long-term story. It is not built immediately, but by trial and error - this will take time. You need to constantly test mechanics and see which ones work and which ones do not.
What types of loyalty programs are there?
Most often, businesses use the following mechanics:
Bonus.
Discount.
Multi-level.
Paid subscription.
Cashback.
Bonus. For each purchase or target action, the store accrues bonuses to the client as a percentage of the purchase. Most often, one point is equal to one ruble - but there may be another system. For example, clients of the healthy food store Ruketo receive from 2 to 10% depending on the purchase amount. The higher the purchase amount, the more bonuses the client receives. Accrued points are available for six months, and then expire. This motivates clients to buy faster.
Case Ruketo: “If there is no loyalty program, it is very difficult to stay on the market”
Loyalty program from M.Video
When purchasing in the M.Video online store, in addition to bonus rubles, you can use a personal discount. It is different for each client and depends on the purchase history
Customers can spend points in different ways - only on the website, only in offline stores, or both. For example, in Samsonite you can buy a suitcase in the online store, get points there, and then spend them in the showroom or vice versa. Bonuses can be used to pay up to 30% of the purchase. If it is a discount store, up to 10%.
How the loyalty program is organized in the Samsonite store
Loyalty program from TOY69 store
An example of the loyalty program of the Toy69 store. Customers see information about points in their personal account. A pop-up banner will briefly tell you how points are awarded and how to spend them
Customers at the Madrobots online store are credited with madcoins, which can be used to pay for their next purchase.
Loyalty program from Madrobots store
The balance of madcoins is displayed in the personal account of Madrobots. One madcoin is equal to one ruble
Discount. The store gives the customer a fixed or cumulative discount - the more you spend, the bigger the discount. In an offline store, customers present a discount card or code from the app. When shopping online, the discount is displayed in your personal account on the website and is applied automatically
KaramelkaShop Case: “Meter-long stacks of hundreds of orders were reduced to 3 clicks, and the bounce rate was reduced by 10% in the first month”
Loyalty program from Karamelkashop store
Karamelkashop has a loyalty discount program - the discount increases proportionally to the amount of purchases
Multi-level. At the start, the client is given a minimum bonus or cashback, which then increases with the growth of the purchase amount. For example, the Toy69 store gives each new buyer 5% cashback on all products and 3% on promotional items. As purchases grow, so do the privileges. When the client buys for 300,000 rubles, the cashback will become 30%, and 15% will be credited from promotional items.
Loyalty program from TOY69 store
The Toy69 store has four levels of loyalty program. The first level has a minimum discount, and by the fourth level it increases
"Multi-level loyalty programs work better thanks to the gamification element. It can be played out in a cool way and involve the client in the process of moving through the levels so that he strives to reach the end and get the maximum discount. The
main thing to remember here is that the client needs to be involved and supported with communications. For example, highlight how many points he received from the purchase, how many have burned out, or how many are left to collect before moving to the next level."
Violetta Danylchyk
Violetta Danylchyk
Head of CRM Marketing at Radis
Pult.ru also has a multi-level loyalty program, but it is more complex. Clients start with the standard level and a 3% discount. When the purchase amount reaches 150 thousand rubles, the client moves to the next level with a 5% discount and so on until he reaches the maximum - diamond.