How to Start Your Own Customer Loyalty Program
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Do you want to start your own customer loyalty program?
It’s no secret that it’s much easier and less expensive to sell to existing customers than it is to aquire new ones. In fact, retaining an existing customer can be up to 25 times more cost-effective for a small business than acquiring a new one.
With all of that being said, customer retention is clearly an important part of any small business’s marketing strategy.
In this article, we’ll share a few ways you can start your own customer loyalty program to help cut down on customer churn, improve engagement, and boost sales.
- What Is a Customer Loyalty Program?
- Why Start a Customer Loyalty Program?
- How to Start a Customer Loyalty Program
- Using WP Simple Pay to Create a Loyalty Program
- Going Forward
What Is a Customer Loyalty Program?
The most cost-effective way to retain customers is to reward them for their commitment to your products or services with a customer loyalty program.
A customer loyalty program is a system that rewards customers for making regular purchases and engaging with your brand. The goal is to incentivize customers to spend more money by repaying them with rewards. Rewards can include discounts, points redeemable toward future purchases, free items or services, or even exclusive access to new products or paid content on a membership site.
In some cases, you can use a customer loyalty program to entice subscribers who have cancelled their subscriptions to rejoin or renew their plans. For example, you can send those cancelled subsrcibers a free trial period offer on their birthday.
Regardless of how you organize your customer loyalty programs, they are highly effective at boosting customer retention, minimizing churn, growing your customer base, and ultimately driving more sales for your business.
Why Start a Customer Loyalty Program?
If you stop and think about it, you can probably name at least one customer loyalty program you belong to right now. Perhaps you own a rewards card from your local grocery store, or you get your card punched at your favorite coffee shop each time you buy a cup of coffee to earn the 10th one free.
There are countless ways to structure your customer loyalty program. Some businesses give out points that customers can use towards anything they like. Other businesses create VIP clubs that entitle members to certain perks, gifts, or access. Some programs reward customers by donating money to nonprofits on their behalf.
Why should you implement your own customer loyalty program? The benefits are clear:
- Higher customer retention because customers are incentivized to make purchases with your business over your competitors.
- Reduced marketing expenses because you’re only paying for marketing (the program’s rewards) when you make a sale.
- Customers naturally tell their friends and family about your brand (word-of-mouth) because everyone likes saving money where they can.
How to Start a Customer Loyalty Program
Starting a customer loyalty program requires a careful understanding of your customers and what motivates them. Once you make a few key decisions, you just need the right tools to manage the technical details.
Let’s go over the steps you’ll need to take to create your own customer loyalty program on your WordPress site and what tools you’ll need to do it in the most efficient way possible.
Choose the Rewards
Your first step is to choose how you’ll reward your customers for their loyalty. Not all rewards are equal. It’s important to choose the rewards your customers find valuable.
Ask yourself what kinds of products or services your customers find impossible to pass up. In many cases, this is as simple as discounts on future purchases, but some customer groups have unique needs and preferences.
Here are some places to get ideas to reward your customers:
- Listen carefully to conversations you have with customers.
- Track customer behavior on your site to understand what they want. Many customers browse your services, but never actually purchase. You can use a tool like MonsterInsights, the best analytics plugin for WordPress, to get genuine feedback from your visitors to remove the guess work.
- Pay attention on social media, especially when your customers and fans have conversations with each other.
- Check out your reviews and testimonials to see what your customers are saying. Perhaps, they’ll request a specific perk while writing a review.
Determine Your Loyalty Program Structure
Once you’ve worked out what you’ll give your customers for their loyalty, you’ll need to determine the structure of the program. You have a lot of freedom here to be creative, but many brands use one of these common structures:
- Points Program – Customers earn points for spending money. Points can be spent on future purchases.
- Paid Program – Customers pay a monthly or annual fee to join a VIP club. Club members receive exclusive benefits, like discounts, early access, or limited products or services.
- Charity Program – Customers earn points for spending money. Those rewards are donated to a related or chosen charity.
- Tier Program – Customers reach certain tiers based on their purchases. Higher tiers offer higher rewards. You can name them something simple, like “Gold,” “Silver,” and “Platinum.”
- Community Program – Loyal customers are given access to an exclusive community of like-minded people.
- Subscription Program – Similar to the paid program, this program rewards customers for joining a subscription service.
- Partner Program – Customers receive rewards with a different brand for purchases they make with you.
- Affiliate Program – You can create an affiliate marketing program that allows your customers and partners to earn commissions each time one of their followers purchases from you.
Additionally, the structure of your customer loyalty program is a great place to add gamification to your site.
Using OptinMonster, the most powerful lead generation software for websites, you can easily implement gamification elements to your site that encourage customers to keep “playing.”
For example, you might:
- Give customers badges for reaching new program tiers or milestones.
- Keep customers focused on their reward progress by showing them progress bars.
- Have them find clues throughout your site to earn rewards.
- Offer rewards for non-purchase activities, like sharing your posts on X.
Choose Behaviors to Reward
Your next step is to choose which types of customer engagement you want to incentivize. These should be behaviors that support your goals.
For example, if you just want to drive more sales, you can simply reward customers for each purchase. In fact, this is the most common type of customer loyalty program.
However, your goals might be more specific. If you want to acquire more long-term customers, you can reward customers for referring their friends. If you want to create more online buzz, you can reward them for engaging with your brand and sharing your content on social media. You might also consider incentivizing purchases during your slow season, certain hard-to-move products and services, or purchases over a certain dollar amount.
As you can see, this is another area where you have a lot of creative freedom. Just make sure the behaviors you choose to incentivize are ones that serve your needs.
Use Customer Loyalty Software
Once you’ve decided on the specifics of your customer loyalty program, your next step is to choose the software that will manage it. Yes, it’s possible to manage the program on a spreadsheet or code a custom solution yourself, but that’s rarely worth the time and effort when quality solutions already exist.
Plus, the hallmark of a good loyalty program is a quality user experience. Your customers need to understand how the program works and how to view and spend their rewards. If the program isn’t transparent, customers may assume you aren’t being honest.
So, it’s important to use a quality tool that offers plenty of features for both you and your users.
Here are some good choices:
- Points And Rewards For WooCommerce
- Kangaroo Rewards
- Loyalty Gator
- Loopy Loyalty
Using WP Simple Pay to Create a Loyalty Program
While these solutions offer specific loyalty program features, you can also use WP Simple Pay, the #1 Stripe payments plugin for WordPress, to create your own programs easily and cost-effectively. This is because the plugin allows you to integrate your payment forms with other popular WordPress plugins to not only accept payments from customers, but also to build a customer loyalty program that encompasseses targeting the right customers through marketing eNewsletters, popup notifications, push notifications, and social media.
If you want to keep your program simple, you can easily add percentage-based or fixed amount discounts directly to your payment forms. The best part is, the plugin lets you set up expiration dates for specific coupons and discounts, as well as custom redemption limits that reward your loyal customers once or as many times as you choose.
WP Simple Pay makes it easy for you to apply coupon codes and discounts for individual payment forms directly in the payment form builder.
Once you’ve created your customer loyalty coupon code and chosen the specific payment forms, all you have to do is add the coupon field to your payment form using the payment form builder to activate it.
Notice the coupon code field is placed directly above the payment button on the example below:
Now that you’ve learned how easy it is to add a customer loyalty discount code to your payment form, you’ll want to market the offer to your loyal customers. The best way to do this is to put it in their payment confirmation email. This way they are almost gauranteed to see it.
Thankfully, WP Simple Pay makes it easy to create customized payment confirmation emails that allow you to add the customer loyalty coupon code directly to the message. This ensures that only the customers who have purchased from you receive the loyalty discount code for a future purchase.
Promote Your Customer Loyalty Program
Remember, your customer loyalty program is only valuable if customers use it, so you’ll need to aggressively promote any programs you’ve created to your customers and fans.
Promote your loyalty program like any other product. Send emails to your list, make social media posts, write blog posts, add banners and targeted popups throughout your site, and send push notifications.
Wondering how you can do all of this without using code? Here is a list of guides to help you get started using WP Simple Pay and possible automation integrations.
- How to Automate Posts on Facebook Pages in WordPress
- How to Increase Donations Using Targeted Popups
- 6 Ways to Boost Sales & Retain Customers with Email Receipts
- 13 Essential WordPress Plugins for Business Websites in 2023
- 7+ Ways to Maximize Coupons on Your WordPress Site
- How to Add New Stripe Customers to Your Mailing List Without Code
- How to Add a Free Trial Subscription in Stripe With WordPress (Easy Way)
- How to Add New Stripe Customers to ActiveCampaign in WordPress
Keep in mind that not only do you want all of your customers to know about this program, you also want your potential customers to know about it. This could be a powerful selling tool that convinces someone to buy from you over your competitor.
Customer loyalty programs become more valuable for you as your customer base grows, so it’s smart to launch your program as soon as possible. Don’t worry if you haven’t perfected it just yet. The sooner your customers start earning rewards for their loyalty, the sooner they’ll become devoted for life.
If you liked this article, you might also want to check out our guide on how to use limited-time offers to drive sales.
What are you waiting for? Get started with WP Simple Pay today!