Economics/Business

Rewards program definition/benefits/How do you create

Having a rewards program can go a long way toward increasing sales and customer loyalty, whether you’re running a small business or part of a large-scale company. Rewards program definition

Therefore, in this article we will introduce you to what it is, what its benefits are and what types of rewards programs you can implement to grow your business successfully.

What is a rewards program?

A rewards program is a strategy that allows to reward the various actions that customers perform, both in the establishment and online, in order to promote interaction with the brand, repeat purchases and customer loyalty .

Reward programs provide enrolled customers with discounts, unique offers, exclusive events and points that can be used in a variety of ways, helping to improve the customer experience through recognition of their commitment to the brand.

The more activities customers take to engage with the brand, the more points they will receive. In addition, they can earn a higher number of points by ordering higher value. Rewards program definition

One of the best-known examples is the Starbucks rewards program, which currently accounts for more than 8 million transactions per week and has more than 12 million Gold Members in the United States. 

What are the benefits of a rewards program?

Offering free products, discounts, and special shopping opportunities to repeat customers shows you value their commitment and encourages them to stick with you. In addition to these, some of the additional benefits that you can obtain by developing a rewards program are:

1. Increase customer retention

The main reason for a rewards program is to achieve customer retention by rewarding them for their repeat buying behavior . With a rewards program, customers can have a solid reason to return to buy with your brand and establish consumption habits.

2. Attract new customers

Undoubtedly, a good rewards program can increase word of mouth recommendation about the multiple benefits that acquiring your products or services brings, which contributes to attracting new customers who are in search of the best prices, quality and service. .

3. Obtain relevant customer data

When a customer enrolls in a rewards program, consumer data is recorded in the company’s database and can be used to perform customer segmentation , profiling the most frequent customers and tailoring their offers to specific groups. of consumers. 

4. Know consumer trends

Like this data, reward programs can provide a more complete view of customer behavior, buying habits, and preferences, and the business can use this information to strengthen inventory management, pricing, and planning. promotions. Rewards program definition

This data also allows marketers to measure the results of special promotions based on additional purchases, the use of new channels or the decrease in the time between purchases.

5. Increase the average ticket

A business can use the collected data for cross-selling and upselling. For example, you can offer extended warranties after purchasing an item, suggest accessories that go well with the purchased item, or offer discounts on related purchases. 

In addition, the rewards program can also increase demand in the off seasons, such as an airline rewards program that is only available on select flights during seasons of interest.

6. Reactivate inactive clients

One of the least considered points about rewards programs is that they allow companies to offer incentives to reactivate those customers who have not bought for a long time.

By implementing a rewards program, you will have the opportunity to demonstrate to your inactive customers the news of your menu and the unique promotions that you can offer them to become frequent customers.

How do you create a good rewards program?

Here are some strategies that you can implement in your rewards program:

1. Enrollment rewards

Creating an account in the rewards program is the first customer activity that can be rewarded with points.

Many people often do not want to use their personal and contact information to sign up for a program or are simply lazy to do so. Therefore, you can provide reward points as strong incentives for them to sign up for the program. Rewards program definition

2. Rewards in points for your purchases

This is one of the most common ways to reward is through a customer point system , which pretty much follows a simple principle: spend more to earn more. 

By allowing shoppers to earn points every time they make a purchase, you can incentivize them to buy more times and increase the average ticket.

3. Rewards for product reviews

Another idea to take into account for the design of your program is to allow customers to accumulate points by writing reviews of the products purchased on your website, with which they can have access to a unique benefit.

4. Reward for referral activities

A Nielsen report found that more than 90% of consumers trust suggestions from friends and family more than advertising. It’s easy to turn your customers into a trusted brand ambassador by rewarding them for recommending your online store to friends and family. 

5. Reward for sharing on social media

Your program can include reward points for customers who share comments or images of your products through social networks, which can also attract more organic traffic to your website.

In this way, you have a greater possibility of converting that arrival of online visitors into sales and your customers obtain more points to exchange for special promotions or discounts. Rewards program definition

6. Rewards for surveys

An effective rewards program strategy can be to administer customer surveys and offer rewards for answering them. 

This type of program has been widely implemented by fast food chains, as they allow customers to take an online survey to obtain rewards, whether in points, discounts or free products.

Related Articles

Leave a Reply

Your email address will not be published.

Back to top button