- Hi, I'm Darlene from GoDaddy's How-To.
- And I'm Emma from The Journey.
And today we're going to talk about managing
your customer loyalty program.
And these programs can be the lifeblood of repeat customers.
And they essentially reward customers
for returning often to your business.
And back in the day, it was all about punch cards, right?
I know I had one for my favorite sandwich shop.
But now these loyalty programs
have become more sophisticated
and essential for your business.
- And if you currently don't offer a loyalty program,
this might be the opportunity to start one
and communicate those customer rewards
out in your marketing efforts.
It's all about building loyalty and customer retention.
Did you know that a 5% increase in customer retention
could increase your profitability by 25 to 95%?
That's a huge return.
And it costs five times more to win a new customer
than retain an existing one.
- Yeah.
So here are some ideas for retaining those customers
and keeping them happy.
Number one, giveaways.
People love free stuff.
So think about something your customers would love to have.
Could be a free slice of pizza.
I know I would love that.
All the pizza.
Or a piece of merch, like with your logo on it.
And you could send it to influencers on social media
to create buzz around the giveaway.
And this is a great way to bring customers to you
and your services.
- Another idea is to offer your customers VIP level rewards.
These are often special perks
for spending levels for customers.
An example here is MAC Cosmetics,
which has a MAC Lovers program.
And as you can see,
they give customers more perks
for higher spending levels each year.
This gives customers an extra incentive
to be loyal to their brand.
- Another loyalty program idea
is offering points for purchase.
And this allows your customers to gain points
related to every purchase and exchange
for free goods or services,
once you've gained enough points.
And this is the closest program
to that old sandwich club card I was talking about,
or a coffee punch card,
10 punches and you get a free cup of coffee,
I love that.
You buy enough of something and you get something free.
That's all it is.
Now Starbucks has been doing this for a long time
with their Starbucks Rewards.
And as you can see,
they have a lot of ways to keep their customers
engaged with their brand.
They have an app, birthday rewards, games.
They're doing it right.
But the rewards don't last forever
and there's a six month window on the point expiration,
so again creating an incentive
for customers to purchase often before their points expire.
- That brings up a good question for businesses
that have loyalty programs.
What do you do when customers can't come into your store
during a crisis, like we're seeing with COVID-19?
- Yeah, and that's exactly what Starbucks did.
They communicated out to their Rewards members
that they would be extending the expiration limits
to cover reward benefits while their stores were closed.
So consider extending those benefits to your customers.
So when they return you'll have lots of happy customers
ready to spend money and earn more rewards.
- And if you're a business that is open during this time,
but maybe in a limited capacity, like a restaurant.
You might want to consider offering a discount on rewards.
So if a free coffee normally costs a customer
100 points to redeem, maybe you bump it down to 50
for the next 30 days.
Or offer double points this month,
which is essentially the same thing.
Try both campaigns
and experiment to see which one gets more traction.
While businesses might be slow,
this is a great opportunity to build customer loyalty
by offering them an incentive to buy from you.
- Oh, I actually have a good example of that, Darlene.
Of the limited capacity.
I noticed here in San Diego,
there's this really popular car wash, Soapy Joe's.
And a way that they are limiting the capacity
is that they're only allowing their members to come in
through the hours of 9:00 a.m. 'til 5:00 p.m.
at all of their locations.
- And remember, I know we've said this 100 times already,
but communicate with your customers.
And it doesn't have to be overkill,
just an email or a tweet once or twice a week
letting them know that we've got you covered.
Your customers have a lot on their minds right now,
so assure them that their loyalty rewards are safe
and it'll be here when they get back.
- Well, that's all for today.
Check out some other videos and resources
GoDaddy has put out there for small business owners
and entrepreneurs.
And if you need help,
you can always call our customer service number
and speak to one of our guides.
Until next time, stay safe.
- And stay healthy.