The Power of Consumer Loyalty Programs That Work
At TFL, we understand the heartbeat of consumer loyalty. Today, it’s one of the largest growing trends where businesses vie for attention and repeat purchases to foster loyal customer bases. One of the most effective strategies in the last decade to retain customers has been the implementation of consumer loyalty programs.
Loyalty programs, when crafted with the customer at the center, serve as a focal point for appreciation and better encourage customers to return and engage deeply with a brand. Whether it’s in the business of sporting events or goods, concerts or theater, these programs can be tailored to fit the mission and long-term goals of a company.
Understanding Loyalty Programs
Points Programs
This type of program offers customers the ability to earn and redeem points for discounts, credits, giveaways and even free items. Not only can customers accrue points through repeat purchases, but in some instances, they can earn points on their birthday, by leaving reviews, sharing on social media or through attending special events. These programs usually resonate with consumers due to their simplicity and tangible rewards.
Tier-Based Programs
Like leveling up in a video game, tier-based programs incentivize customers to rise through spending levels and unlocking exclusive benefits as they progress. These tier levels are usually structured around customer participation, engagement and spending behavior to better encourage repeat purchases. This approach fosters excitement and a sense of achievement among loyal customer bases.
The Benefits of Loyalty Programs
The long-term benefits of loyalty programs far outweigh the initial investment of a brand setting it up. Studies have shown that customers enrolled in loyalty programs tend to spend more and, a lot of the time, are driven by the allure of rewards and exclusive offers.
A study from Mckinsey & Company showed over 59% of consumers were more likely to choose a brand over competitors through a valued loyalty program. Creating value helps create loyalty which keeps customer retention high.
Not only do consumer loyalty programs provide benefits to the consumer, but they also help build emotional connections with the brand. Offering consumers the option of live events as a reward can help form an emotional connection that will have an impact on the brand.
A study from TFL in partnership with The Harris Poll shows the benefits of adding live events to a loyalty program. The survey found that over 64% of consumers would recommend a brand that offers live events through their loyalty program, and 62% of respondents would spend more money with that brand if given the option.
Loyalty programs don’t only serve as a way for consumers to build and enhance emotional connections with the brand, but they also serve as a tether, keeping people engaged and loyal to a brand even amid competitive pressures. These customers are loyal and are more likely to become brand ambassadors and vocal advocates for the brand, helping amplify reach through word-of-mouth.
We’ve witnessed firsthand the power of consumer loyalty programs and the positive effect on brand loyalty. Whether it’s offering exclusive discounts, live event tickets or both, consumer loyalty should be at the forefront of brands’ strategies.
By incorporating these insights into business models, companies can cultivate loyal customer bases that not only sustain growth but bring them to new heights.
