What’s in this article:
- Troubleshooting tips to use when rewards don’t have the desired effect:
improve promotions, simplify registrations, and differentiate your rewards
The ideal loyalty program engages and retains valuable customers, but designing that ideal is never simple. Approximately 77 percent of loyalty programs fail within their first two years, taking billions of dollars with them. Thankfully, a lackluster loyalty program is only a failure if you refuse to learn from it. Here are some troubleshooting tips to use when rewards don’t have the desired effect.
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Was it easy to sign up?
Is the issue that customers simply aren’t signing up, even if they are otherwise loyal patrons? If so, take a look at your registration process. If it’s simple and straightforward, the problem likely lies elsewhere. But a convoluted process that demands customers fill out multiple fields may deter them entirely.
Remember that most customers sign-up for loyalty programs while making a purchase — at which point they’re trying to complete a transaction and move on. Every additional detail you ask increases the chance they will set it aside for some other time. Instead, be certain sign-ups must be as painless as possible. Gather only the information you need, avoid asking for duplicate data, and make the process as seamless as possible.
This principle extends to the program’s overall user experience, but it’s essential to start on the right foot. After all, if signing up is a colossal pain, why expect customers to think earning rewards will be different?
Did you promote the plan effectively?
What do your customers know about loyalty benefits? What are you doing to market the program? Are people even aware that you have a rewards plan? Promoting the loyalty program is a prerequisite for customers — they can’t register if they don’t know it exists!
The “Rule of Seven” states that customers need to see an ad seven times before closing a deal. While that’s just a guideline, it does suggest you’ll need to promote beyond the point of sale.
Craft emails for your loyal customers, target your audience on social media and advertise the program’s launch on your website. Once the program and its benefits are associated with your brand, it’ll become that much easier to convince customers to make the leap.
Are your rewards varied?
Most loyalty program rewards are highly transactional, taking the form of point redemption or additional discounts. While that’s perfectly fine, it does make it difficult to differentiate your offer from competitors. If another brand offers the same product with a better discount, why should they shop with you instead?
Don’t be afraid to experiment beyond the traditional rewards model. If it fits your business category, grant limited-time access to exclusive products. For example, a toy company might have a rotating selection of members-only stuffed animals. Brands that emphasize services over products can also experiment through exclusive apps and social media pages where customers vote on upcoming features.
It’s not always possible to salvage a loyalty program, so you may need to scrap everything and start over. Before you do, be sure to troubleshoot the process. If you can improve promotions, simplify registrations, and differentiate your rewards, you may turn your loyalty program around. At the very least, you’ll have a better idea of what to do next time.
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