Tips on designing an excellent loyalty program

February 17, 2016 6:29 am Published by Leave your thoughts

Loyalty cards are only as good as the program behind them. Without an excellent program, your card will turn into just another space-waster inside your customer’s purse or wallet; something they nudge aside while looking for the card belonging to their favorite store that does have an excellent loyalty program.

When it comes time to design the loyalty scheme your card will use, consider the following tools, tips, and methods from CARDCore Group.

First, a word about ROI and ROO

A common assumption made while designing a loyalty card program is that sales and card engagement are more or less guaranteed — so the risk of making an initial loss on your program will be diminished by future sales. In other words, ROO (return on objective) can come at the expense of ROI (return on investment), to the point where it is a detriment to both. It is perfectly fine to roll out your program slowly and aim for steady growth over an explosive start — especially for a smaller business with less capacity for risk.

Gamification

Gamification is the process of adding game-like elements to a program or activity. In particular, adding game-like elements to a card program can excite curiosity and hit that satisfying place in our minds that keeps us occasionally glued to our phones.

VIP loyalty

VIP loyalty refers to a “premium” program that confers additional benefits atop your regular loyalty program. Customers pay a fee or otherwise satisfy a condition to enter — think Amazon Prime vs. an Amazon membership. A premium loyalty program is something that adds value to the customer’s experience and encourages more use, or removes an obstacle to purchasing. In the case of Amazon Prime, its offer of rapid shipping removes the sometimes lengthy wait between a customer ordering and receiving their item.

Loyalty tiers

This is different to a premium or VIP loyalty card program, and relates closer to gamification than anything else. Tiering loyalty cards — with increased benefits only obtainable through steady use — encourages customer engagement. Handing out higher-tier cards during events and promotions is also a great idea for establishing and encouraging a solid relationship between your customer and the loyalty program.

Sometimes, simple is best

For some, the above may look like attempts to reinvent the wheel. A simple, robust, fair loyalty program where earned points are exchanged for rewards at reasonable intervals might work best for those people. After all, a straightforward loyalty program is easier to maintain, freeing up your resources, sales and service staff to focus on what the things they do best: making your customers happy.

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This post was written by CARDCore Group


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