Should you accept mobile payments?
January 12th, 2017Ah, the exchange of goods and services. It’s arguably one of the world’s oldest pastimes, and boy, it sure...
Every business can benefit from a customer loyalty program, and companies that don’t have one are losing out on potential sales. Loyalty programs are crucial for businesses because of one simple fact: they reward customers for spending more money. It may seem like a fairly basic strategy, but it is very effective, and it’s all too often overlooked.
An article published in Forbes in 2013 determined that it is seven times less expensive to keep a current customer than to acquire a new one (source). Their suggestion was to offer a loyalty program — any loyalty program. But over the last couple years, it’s become increasingly clear that gift card app programs may be the most effective way to stay top of mind.
Large corporations frequently use loyalty programs to boost sales
It’s a known fact that large corporations use customer loyalty programs to boost their sales, especially when they have downturns and need a quick revenue surge.
The Starbucks case study is one of the best examples of how effective loyalty programs can be when combined with mobile technology. Starbucks was the first national retailer that integrated their mobile app with their loyalty program back in 2011. The My Starbucks Rewards app allows customers who pay for Starbucks products with the app or a Starbucks card to earn Stars, which can be redeemed for prizes.
CEO Howard Schultz largely credited the My Starbucks Rewards loyalty program along with the company’s mobile payment capabilities for the company’s 11 percent increase in second quarter revenue in 2013 (source).
Smartphone apps are enhancing traditional loyalty programs
Even though a basic loyalty program is better than nothing, utilizing the latest mobile loyalty program technology can give you a competitive advantage and improve your program participation rate, as the Starbucks case study and several others prove.
Loyalty and gift card programs for businesses have been around for decades in one form or another, but they have been enhanced in recent years by the availability of smartphone mobile loyalty apps.
Mobile loyalty apps are considered to be the most effective form of mobile marketing, based on the results of a survey of worldwide marketers taken in November of 2014. Also, 28 percent of smartphone users made a mobile payment in 2015 with that number expected to grow.
There are several pre-made app options that are budget friendly
Smartphone loyalty apps are more affordable than ever before, and they offer an excellent marketing opportunity for companies that don’t have an existing loyalty program or that want to grow their current program.
Custom developing a loyalty app for a particular business is very effective, but it can have a very high cost. As an alternative, there are premade app options available that can be semi-customized for a particular business, and many of them are very budget friendly.
For example, there are several digital rewards apps with affordable monthly subscription prices that allow customers of small businesses to earn and track reward points. Customizability varies from one service to another, but it’s a low barrier entry point for a lot of smaller companies.
The important thing to do is to start your loyalty program
As mentioned in the Forbes article, it’s better to start a basic loyalty program as soon as you can rather than wait to develop a complex one. Simple loyalty programs really do work, and you have several options available for low cost mobile loyalty apps for your business.
Once you start to see how your basic loyalty program helps you retain your customers and you build some data, you can think about expanding your program with more features or perhaps developing a custom app for your business.