Customer loyalty is such a simple and yet difficult quest. Today, it is important to meet the demands of hybrid customers. They expect individual offers that are perfectly adapted to their current needs. At the same time, this increases the willingness of consumers to switch providers. In addition, in recent years, the seller's market has turned into a buyer's market, which means that the power of each individual customer is becoming increasingly strong. So customer retention is not well-intentioned advice, but a strategic juggernaut in these times of individualism, saturated markets and increasing competitive intensity. Here are some effective tips for defining a sustainable loyalty program!

Use points systems, a simple loyalty program

As you will see in more detail on, customer loyalty is about keeping customers loyal to your company or brand so that they continue to buy products or services from you. This means creating loyal customers and rewarding their loyalty, in other words, implementing a true loyalty and engagement strategy. Bonus programs that act as reward systems can be helpful in this regard. It may sound boring, but it is the most commonly used points method for customer loyalty programs, and for good reason. Regular customers earn points that they can spend again later for a reward. This could be a discount, a free product or a special service. Customers must accumulate a certain number of points to get their reward. Although this system is widespread and seems simple, many companies fail to make the relationship between points and rewards understandable. If it says: "10 points are worth one euro and 15 euros can be redeemed using your points card on your next purchase in July!", this is not motivating or rewarding for the customer, but causes a definite headache. Make your points system simple and understandable!

Using a tiered system to encourage purchases

Finding the right balance between achievable and desirable rewards is a challenge. Most companies struggle at this point. One way to combat this problem is to implement a tiered system that rewards loyalty early on and encourages purchases. Introduce small rewards for participating in the loyalty program early on. Then encourage customers to make additional purchases by increasing the value of the rewards as they progress through your tier system. This way, customers are constantly reminded of your points and are encouraged to keep buying and stay loyal. The biggest difference from a simple points system is that customers get long-term benefits from the customer loyalty program, in addition to short-term rewards. That's why it's especially recommended for businesses with high costs that rely heavily on customer loyalty, such as airlines, restaurants or insurance companies.

Charge a processing fee for bonus benefits

Yes, you read that right! It may even make sense to charge a fee in the interest of the customer loyalty program. In some circumstances, it makes sense to charge a one-time or annual fee. A fee that helps the customer overcome the barriers to purchase that you are aware of is a benefit to both the customer and the company. By identifying the factors that cause the customer to forego the purchase, a fee-based incentive program can be developed.