Customer Loyalty Program: A complete Guide
Table of Contents:
- What defines a customer loyalty program?
- 6-step checklist for using travel as a customer loyalty play
- 10 interesting stats about customer loyalty you may not know
What is Customer Loyalty Program?
Customer Loyalty programs are strategic plans to boost customer engagement and retention. In textbook definition, customer loyalty is when a company retains it customers by giving them the value of experience and satisfaction.
Customer loyalty programs have come a long way from giving generic discounts or rewards to offering personalized services to their members. One of the reasons is a plethora of choices customers are getting these days, making them less likely to stay loyal to just one brand. This also presents a challenge to brands, as customers and members want to feel deeper connections to their chosen brands and feel like they are either doing good or gathering more the longer they stay.
6-step checklist for using travel as a customer loyalty play
Travel-centric customer loyalty programs are one way to earn and solidify customer loyalty through high-value additions. But let’s not forget the importance of data and analytics to determine the right customer sentiment.
Understanding Loyalty Program Trends is crucial for its success and strengthen it in the longer run. This six-step checklist is the ultimate guide your business will need to improve analytical insights into your loyalty program model.
Make sure to be accessible across all touchpoints & meet your customers half-way
Proactive and informed customers are using more touchpoints than ever throughout their purchase journey. The average traveler will use 16 different sites before deciding where to go. It is important to be transparent and make sure your provider can offer the best deals. Are you giving your customers the best options? Give them a one-stop, confident place to shop for travel online.
Use customer travel and redemption data to craft targeted campaigns
Integrate the customer data you collect into buyer personas and make it as accurate as possible. Your loyalty program is the prime place to combine the rich repository of data in a multitude of ways to create marketing strategies and campaigns. Your customers can give you valuable insights into how to reach them, and what benefits they view as most valuable. Providers like Custom Travel Solutions allow brands to build a la carte solutions to truly reach their target audience and speak to customer data.
Monitor customer reactions and optimize
Choose the right social media messaging for your business to keep an eye on the real-time customer reactions. Keyword and predictive analysis will also help you get collected insights about the target audience for your business and help you optimize your loyalty program accordingly. Listen to your customers and analyze their feedbacks or reactions carefully. You can then perfect your loyalty program as per your customer needs. This can be verified by targeting ads at the specific segment of the customers and analyze how they feel about your products and whether you need to change anything.
Create experiential rewards
Travel as a loyalty play is the perfect added product to create experiential rewards that take the connections to your customers deeper and allow them to see your brand, regardless of industry, as a high-value part of their consumer life. Travel is the ultimate motivator, and your brand has the ability to leverage travel as a powerful loyalty program through high powered benefits and engines.
Push towards advocacy
The loyalty programs have grown beyond traditional benefits to referral opportunities and incentivization for increasing the visibility of the brand. Find ways to prioritize your customers and become deeply engaged with your brand across social networks. By simply increasing the customer lifetime value and repeat purchase rate ensures that you are inspiring loyalty and success along the way.
Does Travel Club Membership have a role in retaining loyal customers?
The key to a successful business and revenue growth is not just bringing in new customers but retaining the loyal customers you have, too. It is true for travel businesses especially in the ongoing crowded e-commerce era where clicks and conversions are adding to the cost.
As per a research by Harvard Business School, a business can increase profits by 25% to 95% just by increasing retention rates by 5%. Sounds good, right? But how to increase customer retention rate effectively? How to rightly re-engage your customers to get them to come back? Simply splurging on sales and marketing won’t do the trick.
The surest way to retain the customers you have invested in is by offering them a loyalty program that they can believe in and keep coming back for more.
1. Maximizes your business
Travel club membership maximizes your business’ existing acquisition efforts by offering them a unique array of travel benefits and lifestyle services.
2. Increase your products’ momentum
You can position a travel club member program as per your business requirements to increase your products’ momentum. Surprise your customers by introducing them to the latest offerings and travel club membership benefits such as rewards, live chat, unparalleled travel assistance, personalized itineraries, etc.This will generate excitement in the customers to be able to accomplish their travel dreams with these new benefits.
3. Reciprocation through rewards
- It will delight your existing customers and keep them coming back for more. Handing out freebies can be costly.
- This is why travel club membership gives your customers the best in class services with frugal add-ons such as baggage discounts and seat upgrades.
- People love being VIP members of a loyalty club. Travel clubs are an ideal retention loyalty program that makes members feel like a VIP with loyalty benefits that surpass travel and lifestyle.
4. Customer retention ideas
A travel club prioritizes retention and employs the best customer retention ideas to reduce attrition. By encouraging new customers with welcome rewards and a touch of personalization for loyal customers, travel club caters to each and every member.
5. Increase in customer purchase frequency
Your business can witness a significant increase in customer purchase frequency as members will purchase more to earn more travel club rewards. Each time they shop, your business will generate more revenue with repeat purchases.
6. Communication is the backbone of retention
Travel club providers should understand that communication is the backbone of the retention toolkit. Customers are engaged by high-touch customer service, newsletters, exclusive deals, and other endorsements. This type of acknowledgment makes your business more approachable to the customers and build lasting trust.
7. Achieve the never-ending pursuit of excellence
Travel club helps your business to achieve the never-ending pursuit of excellence by working on key facets – error-free process, dedicated customer service, reducing customer churn with an immediate and proactive response, continual customer satisfaction, expand cross-selling and nurture customer relationships.
Even a small increase in customer retention rates can dramatically increase your business revenue and profitability.
8 interesting stats about customer loyalty you may not know
The ephemeral nature of customer loyalty stems from the fact that customers these days prefer to be polygamous. Customers have more power than ever which makes retention and loyalty increasingly difficult. The disruption levels in the travel and hospitality industry have never been higher. Brands are reverting to loyalty programs to reduce the churn rate while defending and expanding their market share.
To dig deeper and paint a better picture of the current state of customer relationships within the retail industry, we bring you 10 lesser-known stats about customer loyalty. These stats will help you understand what makes customers want to stay with your brand and how to maximize customer loyalty.
The existing customer is more valuable than the new one. The probability of selling your product to an existing customer stays at about 60-70% while that of selling to a newly acquired one is just 5-20%.
Customers have been known to cheat their favorite brands after a negative experience. A recent study found that n nearly 42% of customers in the US will stop buying from their go-to brand after just two bad experiences.
- According to a recent product loyalty research, customers love to get rewarded during their online shopping experience. About 58.7% of online shoppers believe that earning rewards and loyalty points is one of the best perks of online shopping experience. About 83% prefer online shopping for ‘quick and easy checkout’.
- The current era signifies the new age of brand loyalty with growing Gen Z and Millennials shoppers. They prefer personalized experiences and the trend doesn’t seem to slow down anytime soon. About 87% of customers in the US are willing to exchange their personal information or have their purchase activity tracked in exchange for personalized rewards.
- Loyalty programs are gaining popularity over the last decade and customers enjoy a brand more if it has a loyalty program. About 77% of consumers are likely to be loyal to a brand or continue using its services if it has a good loyalty program while 70% of them are likely to recommend it to others for the same.
- Customer service is the most important aspect that gives the overall impression of the brand to earn the advocacy of its customers, especially for mobile apps and online chat. Millennials and Gen Z along with others prefer a brand with better customer service and about 69% of US customers are willing to spend more on a brand if the customer service takes care of their needs quickly.
- A strong emotional connection, that goes beyond transactional one, is the strongest driver of loyalty. Brands that take a 360-degree view of their customers and use attitudinal as well as emotional data to bond with them will inspire lasting loyalty.
- Customers are interested in engaging with brands through new and emerging technologies such as chatbots, Virtual Reality, wearables, Augmented Reality and so on. 95% of loyalty program members are willing to engage with their brands through the growing technology trends.
- Loyalty to products and loyalty to brands are two different aspects and the customer often feels gravitated towards one more than the other. About 21% of customers feel their loyalty to the product while 26% feel more loyal to the brand itself.
- Brands can leverage the emotional connection of customers to the brand for increased loyalty and brand advocacy. Customers who feel emotionally connected to the brand will have a 306% higher lifetime value and are likely to recommend the brand at a rate of 71% as compared to an average rate of 45%.