For most businesses, more marketing dollars go into attracting new customers than retaining existing customers. It is often said that it costs five times more to attract new customers than to retain customers, so it would benefit small businesses on a budget, such as independent garden centers, to shift more of that focus from acquisition to retention.
Customer retention begins with customer service. If customers had a great experience at your store, they are more likely to return. One way to easily incentivize customers to return is with a loyalty program.
We all know what a customer loyalty program is. You probably either think of your favorite lunch spot, where every 10th purchase might get you a free sandwich or bowl of soup, or a grocery store, where swiping your rewards card gives you discounts.
Signing Up and Earning Rewards Should Be Easy
Those two above examples are the two primary types of loyalty or rewards programs: the classic punch card, or the electronic card. Each one has its advantages and disadvantages. Just getting started might seem like a disadvantage of an electronic loyalty card program, but there are many service providers that make it easy to create electronic loyalty cards for your business. There are even app-based approaches for businesses that want to delve into that world. Either way, electronic rewards programs are great ways to collect customer data. You will know who is buying what and when, which helps you make inventory decisions. On the other hand, customer data from loyalty program members might not represent the purchasing habits of your customers at large.
Another advantage of an electronic loyalty program is that you can ask for phone numbers and email addresses when signing up customers to the program. If you get permission to do so, you will be able to communicate promotions by text message and email. A loyalty program is a great way to build a phone number or email list, which you can use to get the word out on promotions, sales, new products, and in-store events.
The data you collect electronically can be helpful in running a business, but a simple punch card is less intrusive and easier for the customer, which might result in more consumers taking you up on the offer. Someone eager to leave the store with their new purchases might not want to stick around for another five minutes to sign up, or they might not want more of what they perceive to be spam filling their inbox. Simply handing over a punch card is a lot more convenient for the customer, and the most important thing is getting the card into the customer’s hand so that they return to make use of it.
Rewards should seem achievable. If it’s going to take 10 or 20 visits to get something out of a rewards card, it might not be worth it to the customer. One way to make rewards seem achievable is by offering multiple tiers of rewards to keep customers coming back. Instead of getting a discount or something free on their 10th or 20th purchase, create milestones along the way: 3rd, 5th, and 10th purchases, for example.
Offer Personalized Rewards
Rather than give the same standardized rewards to everybody, personalize available rewards based on customer preferences. Think about the different types of customers you have. There are those who buy seeds and seedlings, and then there are the houseplant aficionados, and you’ve also got your lawn-care people. Offer each customer rewards relevant to their interests.
Build a Sense of Exclusivity
A rewards program can make customers feel like they are part of an exclusive club, especially when dealing with a small or local business. Enhance that feeling by offering rewards that make them feel like an insider. For example, you could give them early access to new products. Or, after a certain number of purchases, members can gain access to workshops, classes, or other in-store events that are closed to the public. People will tell their friends about experiences like these, which will lead to more new customers and more repeat customers.
