Loyalty cards enhance the
customer experience. Customers earn discounts or other benefits in return for their continued patronage while business maintain a healthy customer base. Here are a few of the benefits loyalty cards and loyalty programs include-
1.
Customer RetentionAs mentioned, the main reason companies provide a loyalty program is to keep customers shopping their brand rather than at a competitor. By offering a reward for repeat business, the company is more likely to see those customers continue spending on their products or services. A customer loyalty program offers a motive to keep customers interested in brand loyalty.
2. Relevant Customer Data and Consumer Trends
Another key factor in implementing a loyalty program is in
collecting consumer data with every scan of a loyalty card. When a shopper registers for the rewards card, their data is stored in the company database. The data from the loyalty program provides a clearer picture of what customers spend on and preferences directly related to customer behavior. This consumer data is then used as a profiling factor for companies to tailor their offerings more specifically to their target shoppers.
3. Reducing Unprofitable Customers
A benefit of loyalty cards that is sometimes missed is discovering which customers aren't generating revenue. For example, when an email campaign goes out offering discount codes and a customer hasn't opened any emails in a long while, it's safe to remove those customers from the list.
The most well-structured loyalty program will provide companies enough data to create segments which highlight profitable and unprofitable customers. Using a well-thought-out rewards program gives businesses the opportunity to reward loyal customers whom are initiating a more profitable return.
4. Better Customer Communication
A loyalty rewards program offers a chance to create open communication with customers. This doesn't just refer to a help center but rather is a direct line to customers to facilitate communicative efforts. This enhanced customer communication can be used to announce new products or services, promote upcoming sales, or notify customers about upcoming sales or even product recalls.