You might think that attracting new customers is the way to go. But data tells us the contrary. It’s your returning customers who are your bread and butter. When people come back to shop with you, they tend to spend 67 percent more than first-timers, according to research by Bain & Company.
There are a variety of ways to target your marketing to get more repeat business, but an easy (and often overlooked) strategy is to offer a loyalty or rewards program. Here are some advantages to starting a loyalty program for your business (as well as how to easily get one in place).
You’ll increase the frequency of your customers’ visits
More of the same people coming in more often means more transactions, which means more sales. And a loyalty program can help immensely with that equation. In fact, customers that participate in the Square Loyalty rewards program return in half the time it takes for nonparticipants to return. Which means that over the same period of time, these customers come in twice as often.
Keep customers coming back.
You’ll increase your transaction size
Setting a minimum threshold for earning stars or points motivates customers to spend more to meet that bar. With Square Loyalty, you can also opt to award customers multiple stars per visit, depending on how much they spend. So if it’s $10 to earn a star, and a customer spends $25 to earn two stars, they might be motivated to throw in another $5 purchase to get to three stars.
It’s fast to sign people up
Your customers can enter their phone number to quickly sign up for Square Loyalty. Phone numbers are faster than email addresses, so you can enroll customers without sacrificing line speed.
You can email your Loyalty customers
After customers enroll, they receive an automated text message welcoming them to the program and inviting them to supply their email address for an additional star. Once they’re in the system, you can reach out to them through Square Email Marketing.
Millennials like them
Loyalty programs have proven to be particularly attractive to millennials. Research from Bond Brand Loyalty highlighted millennials as a key demographic for rewards programs, with 68 percent of 20- to 34-year-olds surveyed saying they would change where they shopped if it meant getting more perks. And one-third of respondents reported buying something they didn’t need or want just to improve membership status. To stay competitive among this demographic — which has some serious purchasing power — it’s a smart strategy to adopt a loyalty program.
In the unfortunate case that a customer has an unsatisfactory experience at your business, a loyalty program is a great way to help make things right. Square Point of Sale allows you or your employees to look up customers’ loyalty status, adjust star counts, and grant rewards at your discretion. This is also a nice option when a straight refund isn’t appropriate. And it encourages customers to come back in.
So how do you get started? Easy. Square Loyalty is a digital rewards program that integrates directly with your POS, and it’s just $25 per month per location. Setup takes just a couple of minutes, and you’re on your way.