Customer retention is a driving force behind loyalty programs in the marketplace. Estimates suggest that a company can increase their profits by almost 50% when they are able to retain 5% of their loyal customers. One way that marketers and stores are able to do this is by developing loyalty programs that encourage their consumers to keep shopping with them. Loyalty programs will usually have a terms of service agreement.
Prizes and discounts have often been the basis of loyalty programs in the marketplace, but today these types of loyalty programs transform into a variety of different promotions that encourage consumers to shop with the stores that feature loyalty programs. Newer loyalty programs offer you the opportunity to receive discounts or points towards future purchases. These types of loyalty programs are excellent ways for companies to gain new customers as well as retain existing customers. Effective loyalty programs are combinations of benefits that help the consumer. These are termed as “hard” and “soft” benefits. The hard benefits allow consumers to feel as though they are getting their money’s worth. For example, you may be able to accumulate several points through loyalty programs that allow consumers to receive gift cards. The soft benefits of loyalty programs provide consumers with the “recognition” factor and allow the consumers to feel important. For example, these loyalty programs provide you with pre-sales shopping opportunities or other advance purchase agreements.
A loyalty program may also offer a variety of different options during the holidays. These loyalty programs encourage consumers to shop at particular stores, and these stores may vie for consumers by offering several different highly prized rewards and offers. Loyalty programs often come in a variety of forms, but whether they are in the form of online offers or vouchers, all are popular and all have worth in the marketplace. It’s in your best interest to learn about the sites that provide these online loyalty programs.