We all get a kick out of a good discount or a free perk, whether it’s a welcome bonus in our inbox or free shipping on an online order. As a small-business owner, you can turn this love for savings into a powerful tool by starting a customer loyalty programme.

Loyalty programmes can help you attract more first-time customers and turn them into regular buyers. They build positive brand relationships with your customers, leading to repeat business and word-of-mouth marketing that can grow both your customer base and your bottom line. Big companies aren’t the only ones who can pull this off – you can too, at a scale more appropriate to the size of your business.

Can you build your own customer loyalty programme?

If you run a small brick-and-mortar business in a fixed location, you could probably create a low-tech, old-school rewards programme offline, although this would create a cost for printing the membership and discount cards. But you could theoretically administer the membership database on your business computer and communicate with members by email or text. You could get cards printed with rows of ‘threshold-spend boxes’ that customers could get stamped or clipped every time they spent above the threshold. When a card was full, the customer would qualify for a named loyalty reward.

However, in larger operations, the admin of an offline system would quickly become overwhelming, and if you run an online business, it’s just not an option. You’ll need a digital platform to run your programme, linked to your point-of-sale system and able to identify customers quickly via their ID or cellphone number.

Luckily there are tools available online that enable small businesses to create customer loyalty programmes. Join small-business support groups on LinkedIn and other social-media platforms to engage with other users and learn more about what the latest tools offer. Platforms like Mailchimp can keep your customers in the loop about special offers, and SMS tools can come in handy for quick customer updates.

Tips for setting up a loyalty programme

• You need a clear reward points system, easy ways for customers to use rewards, and a way to give members regular updates on their loyalty status. Getting feedback through surveys or reviews will also help improve the programme.
  
  
• Email marketing is a powerful tool for building loyalty among customers who have signed up for email updates. Offer enticing deals regularly to catch their attention, but be strategic. Don’t overdo the discounts – mix them up with other rewards like competitions or members-only early-bird access to new products or services.
  
  
• Try to strike a balance between making customers feel appreciated and managing costs effectively.
  
  
• Selecting the right rewards is key. Whether you offer discounts, freebies, exclusive access, or points to spend in your business, ensure that they align with your brand and resonate with your customer base. Make signing up easy by enabling it across multiple channels, such as your website, emails, social media, and texts.
  
  
• Provide exceptional customer service, going beyond mere discounts to solve customer problems effectively. Consistency builds trust. Adding value with educational content about products or personalised recommendations can also engage customers.
  
  
• Encourage positive word-of-mouth referrals and reward loyalty through tiered points-based systems. Use communication channels like email, SMS, and push notifications to inform customers about rewards, special offers and updates.
  
  
• Add surprises, like unexpected gifts or personalised extras, to make the experience of shopping with you more memorable for loyal customers.
  
  
• Track and analyse the programme’s performance to understand what works best with your customers and adjust accordingly. A successful loyalty programme builds lasting customer relationships, so tailor your approach to fit your business size and resources. 

Common loyalty programme rewards

• Sign-up and other discounts
  Offering new-customer or sign-up discounts, typically ranging from 5% to 15%, gives prospective buyers a taste of your products or services and could result in repeat purchases at full price. Add expiration dates to coupons to create urgency and motivate that first purchase. You can also offer regular promotional prices, 2-for-1 offers, special rates on bulk buys and other discounts to loyalty programme members throughout the year to stimulate frequent customer engagement.
  
  
• Discounts to discourage abandoned carts
  Cart abandonment is a common challenge for e-commerce brands, but using abandoned cart coupons is a proven strategy to convert potential customers into actual buyers. These coupons, often percentage discounts like 10% off, provide the extra push to overcome indecisiveness and encourage customers to resume shopping and proceed to checkout.
  
  
• Loyalty points
  Loyalty points programmes are a win-win, since customers increase their points total by buying more. Implement a tiered loyalty system in which customers unlock higher levels of benefits as they make more purchases.  
  
  
• Exclusive access
  You might choose to provide early-bird access to new products, services, or limited-time promotions. This makes customers feel valued and part of an exclusive community.
  
  
• Prize draws and competitions
  Regularly host prize draws, competitions, or giveaways exclusively for loyalty programme members. The excitement of an unexpected win is a way to delight and surprise customers.
  
  
• Free services or upgrades
  Offer complimentary services, upgrades, or add-ons to loyal customers. These could include free shipping, extended warranties, or other bonus features to enhance the overall value of their purchases.
  
  
• Birthday and milestone rewards
  Celebrate customers’ birthdays and important milestones with special discounts or exclusive offers. This personal touch creates a sense of connection and appreciation.
  
  
• Personalised rewards
  Tailor rewards based on individual customer preferences and buying history, to show loyal members that you understand and appreciate their unique needs. Strategically reminding customers to stock up when you estimate that it’s time for them to buy certain items again can also increase engagement. 

A loyalty programmes isn’t just about giving shoppers discounts. It’s a strategic tool that helps you drive sales, increase customer retention, build long-term relationships with your customers, expand your brand’s reach, and ultimately improve your bottom line.

SimplyBiz Business Solutions can help

Explore SimplyBiz Business Solutions when you sign up for the free small-business resources offered by SimplyBiz, powered by Nedbank. Apart from toolkits, handbooks, and tutorials to help develop your skills in business, sales, marketing, advertising and cost management, this site also offers you the chance to network within your industry and the small-business sector. Most importantly, SimplyBiz offers discount vouchers on a wide range of business products, services, and courses, from computer hardware and financial software to printing and payment solutions. If you want to build and maintain a customer loyalty programme, they can help make any digital upgrades that you need more affordable.