Why Loyalty and Punch Card Programs Are a No-Brainer


Basic psychology: People are more likely to frequent businesses where they can get some free stuff. The data backs this up. A recent study by 3Cinteractive found that 62 percent of U.S. shoppers make more store visits or purchases as a direct result of interaction with mobile loyalty programs.

So what’s the holdup for small businesses?

Well, traditional carry-in-your-wallet punch cards are a pain to manage and track. For one, you print out all those cards only to have your customers lose or forget about them. And secondly, it’s pretty impossible to evaluate whether or not your program is actually helping to bolster your bottom line. So with all of these inefficiencies, the payoff isn’t exactly there.

But digital loyalty programs get rid of all these pain points. Square Loyalty, a completely customizable punch card program, is baked right into your Dashboard and your customers’ digital receipts.

The tool automatically tracks and rewards your customers for repeat purchases and visits. What’s more, you can tailor the program by selecting how often you want to reward customers (number of punches), what customers get as a reward (by percentage or dollar amount off), and how much they need to spend in order to get a punch.

But if you’re still on the fence about whether a loyalty program makes sense for your business, here are a few things to consider:

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Keep customers coming back.

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It’ll get you more sales.

Returning customers are much more valuable than repeat customers. They tend to spend a lot more than first-timers when they come back in. So targeting them is worth the investment — and a loyalty program is one of the most direct ways to do that.

It’s low cost.

The only investment you have to make here is that free tenth cup of coffee. Which is not a lot when you think about those nine other coffees that you might not have sold if it weren’t for your loyalty program. What’s more, customers are likely to spend a bit more each time they come in. As Square seller Swamp Rabbit Cafe and Grocery in South Carolina reports, “Some customers are actively trying to earn punches by spending the minimum amount per punch ($5) to get the five-percent-off reward. They’re both spending more and coming back more often.”

It’s quick to set up.

The beauty of Square Loyalty is that it takes just minutes out of your day. You can “set it and forget it” right within the Customers tab of your Dashboard. Simply customize the punches and rewards to fit your business, and Square takes care of the rest, automatically tracking everything for you. And after each purchase, your customers automatically see how many more punches they need — it’s right there in their Square digital receipt.

It gives you valuable insights.

Square Loyalty helps you track the program’s impact on your bottom line and spot trends in your customers’ behavior. You can track the number of customers enrolled, the total punches, and the total redemptions. This is all super-valuable data to help you make informed decisions about where to allocate more time and effort.

It separates you from the pack.

This one is pretty simple. Say there are three specialty coffee shops on your block. Where are people more likely to head? The one that offers them a free cup for their repeat business.

It builds your customer lists.

Loyalty programs can offer an incentive for your customers to provide their email address when they sign up for your Loyalty program. This helps build up your customer lists, which you can then target with marketing email — alerting them to things like sales, events, or announcements (which you can do right from Square Marketing).

It helps with customer relationships.

You establish deeper relationships with your customers if they come in more often. And your customers are more likely to come in a lot — and talk up your business to their friends — if you make them feel appreciated with a loyalty program.

In short, a digital loyalty program like Square Loyalty is worth the very little time, effort, and money needed to get it up and running.

Learn more about how Square Loyalty can help you grow your business.

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