When I was young, my mother took me with her to an S&H Green Stamp redemption store to exchange the green stamps she earned for gifts. My job at home was to take the stamps she received from shopping at different retail stores and add them to her S&H Green Stamp books. Twice a year, we took the completed books to their store for redemption. S&H was the first loyalty program started more than a century ago. Today, most retailers have loyalty programs to increase their customer retention numbers because repeat customers purchase more and cost less to keep.
I have eight active loyalty cards ranging from the drug store to supermarket to restaurant to credit cards to airlines. I prefer programs that make it easy to earn and receive rewards. If you don’t have a loyalty program, you should consider adding one to your toolbox. Here’s why:
· The majority of your sales come from 20 percent of your repeat customers you cannot afford to lose.
· Loyal customers are less price sensitive.
· Loyal members are your brand advocates and recommend you to others.
· A loyalty reward will encourage your customers to bring all their family vehicles to you.
· A loyalty program based upon yearly purchases will encourage additional purchases.
· Successful loyalty programs can increase your market share significantly at a low cost to you.
Most consumers belong to one or more programs. If you don’t have one and your competitor does, you lose. Your customer will feel appreciated and valued. Opening the car door and saying “thank you,” is nice, but giving extra perks is even better. When your customer feels wanted and special, they will not leave you for another.
You probably already belong to several loyalty programs, and if you don’t, your spouse does. Stop and think about which ones you like best. Now, apply something similar to your business.
My favorite loyalty program is a local restaurant I frequent often. It is on the other side of town, so it is not very convenient. I go because I like the food and atmosphere. I joined their reward program and received my card that day. I am rewarded often and always surprised when I have earned another reward just for eating at one of my favorite restaurants. I started going often; the employees know my name and that I am a loyalty card member. I feel like I am treated special each time.
Our industry has a unique challenge; we are not restaurants. Your customers can not come back to your business every week like they can with a restaurant. It takes your customers several months to drive enough miles to require another service. How do you build relationships in only two or three visits per year? How do you demonstrate you actually care about prolonging the life of their vehicles?
The key to any relationship is good communication. The challenge is to communicate with your customers on a frequent basis. Since they don’t come in very often and most likely wouldn’t appreciate monthly phone calls, your answer is to provide high-quality monthly e-newsletters containing useful information your customers find valuable.
Marketing is my passion, and I receive several marketing e-newsletters each week — and some daily. I don’t read everyone each time, but over the course of the year I read most of them. If I find they are trying to sell me something each time rather than provide information I will unsubscribe. The lesson here is, do not oversell. Remember this is a “news” letter, not an advertisement. You should take advantage of this monthly contact to discuss the many benefits of your loyalty program. Many e-newsletters are generic in nature and every customer receives the same one. If possible, utilize your database to individualize each one to match the customer and their vehicle. By providing service history and service recommendations that are tailored to their vehicle needs, you will keep their interest. Another key feature is professionally written news articles that are timely and informative. Seasonal car care and vacation tips are well received, too.
The obvious key to a successful e-newsletter program is to have your customers’ email addresses. Over the past few years, many shops have struggled with collecting these addresses. Recently, most major businesses are asking their customers to go paperless — so should you. You can email service reminders at a fraction of the cost of mailing a post card. The key is to review every customer’s contact information on every visit. You will find many have missing apartment numbers and the email address is missing. Don’t waste your ad dollars by mailing a card without the apartment number. If you don’t have the current email address, you will incur higher costs by mailing a card instead of sending an email. Without an email address you cannot communicate every month by taking advantage of an e-newsletter.
A loyalty program combined with a powerful e-newsletter will keep your brand top-of-mind with your customers.