How to reward engaged and loyal customers
In this digital age it is easier than ever to reward your loyal customers for their individual behaviour but seldom organisations do, and even less, do well. Thanking customers for their continued custom and loyalty to a brand is often overlooked even though rewarding behaviour is core to customer engagement.
There are many facets to rewarding engaged and loyal customers, from the most obvious; retention and increased life time value, and strengthened relationships… to the less obvious; value exchange and market differentiation. Data is now a commodity as customers take greater ownership for their data. Value Exchange (giving customers something in return for their data) is paramount to the success of retrieving the most valuable data.
Surprise & delight with your rewards
Rewards should delight your loyal customers and where possible even surprise them. Some businesses mistake rewards for discount led propositions which are not sustainable long-term and lead to brand devaluation and worse, profit loss. Offering preferential rates in a controlled environment is fine and certainly encouraged as this helps to evoke exclusivity without margin exposure.
Another way to reward is via 3rd party offers. Organisations that team up with partners of similar values and attributes to provide customers with 3rd party offers benefit from increased engagement. These offers are most effective when there is a close association with the chosen brand, and if interjected with own brand rewards’ is a perfect example of how to surprise customers!
Loyalty programmes still work
The traditional way of rewarding loyal customers, and still one of the best, is via loyalty programmes. Loyalty programmes that offer a mix of hard and soft benefits (tangible and emotional rewards) tailored to the individual deliver benefits to both the business and the customer. Points are common currency allowing customers to earn rewards for every transaction, and more recently, for interactions with brands. They are easily understood by customers and easily managed by organisations.
Treat customers like VIPs
Offering free, discounted or exclusive VIP services is another great way to reward customers. Services add value to customer relationships without eroding margin but they are harder to implement as they require company buy-in and resource investment. Organisations that present offers which are relevant and operationally sound will gain and prosper.
As a result of rewarding engaged customers, organisations develop better relationships and create advocacy, helping them prevent attrition. They become top of mind and top of wallet increasing their share of the market.
Remember, thank you goes a long way …..