The great thing about capitalism is that it allows almost anyone to start a business and compete for consumer revenues. The bad news is that it’s difficult to build and foster customer loyalty with so many different choices available to consumers. And most businesses don’t have piles of cash lying around (nor do they want to take out a business loan) that they can use to design and implement a complex customer loyalty program.
“Sure, here’s a pile of scratch. Go create a customer loyalty program!*”
*- this never happens
Luckily, there are a few ways to increase the level of customer loyalty that require little or no capital whatsoever. Here are seven of them.
1. Punch cards.
These allow customers to receive a free item or discount after making a preset number of purchases. For instance, each time someone buys a cup of coffee, you punch their card; and ten punches earns them a free scone. You can print a bunch of these off your own printer using card stock and business card software.
2. Discount card.
These are as easy to produce as punch cards, but their customer benefits are a little more direct. Each time the card is presented, customers earn a small discount (perhaps 5% to 10%) off their total bill. You can limit the promotion to certain items or a minimum purchase level, but the increased business may very well offset the lost revenues from the discount cards.
3. Enlist the aid of social media.
All kinds of businesses are using Facebook, Twitter, and other social media to increase customer loyalty. There are plenty of ways to leverage these platforms, but some that are simple (and low-cost) include “Facebook Friend only” discounts, promotions distributed via Twitter, and hashtag-Tweet offers based on how often someone re-Tweets your Twitter handle.
4. Use QR codes.
This is a relatively inexpensive way to appeal to the tech-savvy crowd. Generating QR codes is easy (there are plenty of websites and software programs that do it), and you can link them to special offers on your e-commerce website or for discounts at your store using mobile payments. You can even tie a QR code to a customer’s credit card or bank account and let them earn “discount dollars” each time they use the code to make a purchase (sort of like a high-tech punch card).
5. Offer “VIP” services and charge customers upfront.
You know how you’re more likely to go to the gym if you’re paying a monthly membership fee? The same holds true for other types of commerce as well. Businesses from massage therapy centers and hair salons to shooting ranges and paintball clubs can offer free or discounted services for members who pay a monthly fee (which, ideally, is automatically debited from their bank account).
6. Provide non-monetary rewards.
Certain businesses can appeal to their customers’ values to generate loyalty. For instance, if you sell eco-friendly products, offer to make a donation to an environmental charity each time a purchase is made. You can even start a “charity drive” promotion where a portion of all revenues in a given week or month will be donated to an appropriate charitable organization.
7. Send thank-you notes.
It’s an oldie, but a goodie. Because they are so rare nowadays, sending a handwritten thank-you note to customers will let them know how much you appreciate their business, and they’re likely to respond with their loyalty. This tactic is especially well-suited to businesses that deal in low-volume, high-dollar transactions (like furniture stores or art galleries).
Of course, if you’re a veterinarian, your “customers” are already known for their loyalty.
Chris Martin is a freelance writer who writes about topics ranging from entrepreneurism to consumer finance to home improvement.
