Digitizing Your Small Business’s Loyalty Program

Loyalty programs are becoming more common recently among all kinds of businesses, small and large. Loyalty programs are an effective way for small businesses to develop their brand, because they allow businesses to increase customer engagement and profits. 73% of loyalty program members are more likely to recommend brands with good loyalty programs. 

In the past, most loyalty programs were carried out through the use of physical cards; however, current consumers are more comfortable with smartphones and apps than physical cards. A virtual loyalty program is a solution to customers having to walk around with multiple physical cards in their wallets. Digital loyalty programs come in easy-to-use interfaces that usually require a few taps from cashiers to scan, even in rush hours, making them an easy strategy to implement. Creating an application for their loyalty program allows small businesses with a platform that they can easily run and manage their digital loyalty programs.

Why Should Your Small Business Create a Digital Loyalty Program?

Customers can misplace physical paper cards but cannot misplace an app or phone easily. 43% of customers say that physical cards are their biggest barrier to redeeming rewards. This is largely because physical cards are easy to either forget or misplace. Instead, 71% of customers are likely to use a loyalty card if it's on their phone.

Digital loyalty programs allow companies to determine the return on investment (ROI) of the loyalty program. Digital loyalty program apps have the ability to compile consumer data in dashboards. There is an ability to identify what offers and messages increase customer retention and the messages that need to be changed for better results. Companies can also target particular customers based on their number of visits. There is also an ability to track employee performance (i.e. which employees have the newest sign-ups).

How Can You Create a Digital Loyalty Program?

Use a Loyalty App Provider

• Easy for your small business to create and manage

• Avoids the cost and time of app development

Build Your Own App

• Hire a developer to create an application to your specifications and manage it

• The expensive choice to develop and maintain the app

• More personalized to your business

Things to Be Included in Your Digital Loyalty Program

1. Homepage on the App or Central Website

This should be a central hub for members to visit for information about the program. This website or homepage can provide general information and promotions concerning the program. There can also be a log-in for members to check how many points they have earned and what rewards they are eligible for. In terms of targeting new members, the website should feature the loyalty program’s name, a brief explanation of how the program works, how they can sign-up, and the rewards the business offers.

2. Email Loyalty Marketing

An email has been proven to be the most preferred channel to communicate with loyalty program members. Emails describing the loyalty program’s launch allow the target audience to receive all relevant information about the digital loyalty program and if they need to take additional steps to earn these coveted rewards. These emails should sell the benefits of the loyalty program in depth. Businesses can also send emails describing each member’s points status to inform members how many points they earned on their last transaction, how many more they need to earn to get their desired reward, and when they need to use them (if points have an expiration date).

3. Push Notifications/SMS Messaging

Push notifications and SMS messaging allow small businesses to have a direct line of communication with their customers. Through a digital loyalty program, they can be created to automatically send the following notification to any customer who hasn’t made a purchase within 2 weeks. This allows customers to feel recognized and appreciated. Your small business is now on their mind and they are more likely to visit you soon!

Key Takeaways:

Small businesses can utilize digital loyalty programs to provide customers with offers and rewards in order to gain further insight regarding consumer activity and foot/online traffic. There is an ability to customize rewards such as multiple rewards at different levels of stamps or expiry date of points which physical loyalty programs do not have the capability to do. People want to shop at businesses that offer them free stuff through loyalty programs that help build a successful and loyal customer base.

As a social impact initiative, Rem and Company also offers free consulting services and resources to small businesses and nonprofits impacted by COVID-19. Our pro-bono consulting teams provide small businesses with the opportunity to identify and prioritize issues facing their business, propose innovative strategies, and facilitate execution. If you are a small business or nonprofit in need of assistance, learn more about how we can help.