5 Rewards to Keep New Customers Coming Back
A one time customer is good, but a repeat customer is even better. They spend more on average and they are more likely to recommend you to their friends and family. In fact, repeat customers are responsible for generating 40% of a store's revenue (and that’s just retail).
So how do you get new customers and clients to come back?
You could just ensure that you create better products or provide better services year after year. The problem is that can cost a lot of time and money. Even then, it doesn’t guarantee people will choose you instead of a competitor.
In most cases, there are several options for people to get the same products or services. You have to reach out and give customers a good reason to come back.
That’s why we’re going to talk about customer rewards. They’re the ticket you need to keep customers coming back. I’m going to take you through five reward options, and show you how to distribute them.
Keep reading to get those customers coming back.
What do rewards accomplish?
The goal of customer rewards is to show customers you value that you value them. Good rewards programs build relationships that benefit your customers and strengthen your bottom line.
In fact, discounts and coupons came in as the top-ranking tactic for driving loyalty, with 61% of consumers saying they use them.
They also give you an excuse to regularly engage with your customers, which can have exponentially positive benefits.
Use these rewards to keep customers coming back.
1. Offer punch cards to increase customer consistency.
Punch cards are a simple and cheap option. You give a customer a hard paper card that gets a hole punched in it whenever they visit, make a purchase, or refer a friend.
Once the card has a certain number of holes punched, like 10, that customer gets a reward. Common options include:
- Free coffee
- Free appetizer
- Free socks
- 20% off next purchase
- Next service free, etc.
But you don’t have to just use physical cards.
You can do the same digitally by tracking customer visits or purchases. These are easier for a lot of customers because they don’t have to remember to bring their card every time.
Square has a great digital option for the punch card. They use the customer's phone number to keep track of points earned in an online dashboard. It will even send the customer a text letting them know when they have a reward waiting.
2. Have loyalty discounts to encourage customers to work with you again.
Many products and services are not bought or needed very often. That means there’s a lot of time between purchases for clients to disengage. A few of these are:
- Buying a car
- HVAC repair
- Roofing repair
- Tax services
Even if customers enjoyed working with you, you need to provide an incentive for them to choose you again.
For instance, Kia gives you cash off a new purchase if you already own or lease a Kia. You can take this concept and apply it to most industries.
Take HVAC services, for instance, you can offer current customers a discount on their next HVAC unit when they move or just need a new one.
3. Share freebies to show customers value.
People love free things, whether it is a physical product or even a how-to guide. If you are an online software company (SaaS), you might offer a free guide that relates to your industry.
For instance, HubSpot offers free Ebooks related to marketing and customer relations.
Offering free guides helps you gain credibility and strengthen your relationships with customers, both of which encourage them to come back.
Another common freebie comes from restaurants. Most will give you a free something for dining with them on your birthday. Restaurants like Provinos will give you an entire meal for free!
4. Run giveaways to increase engagement.
Who doesn’t like random free stuff? Any business can use giveaways to increase engagement, sign-ups, and purchases.
Take Cash App, an online banking alternative, for example. Every Friday they have a give away on their Instagram. All someone has to do is like is and comment with their cash app name tag, and they could when some free money.
This increases engagement with their current customers, and brings in referrals that they're able to convert into customers.
Another example would be for an insurance agency to offer free estimates. Everyone who enters for a free estimate is also entered into a drawing for a tablet, tickets, or some other prize. Then you instantly have a new list of prospects you can follow-up with.
5. Show appreciation with social media shout-outs.
What person doesn’t appreciate some sort of recognition? Social media shout-outs give buyers a sense that you care about them, and most love the added attention.
Use this to your advantage to not only get exposure but to also show off your products, strengthen relationships with your audience, and build loyalty - all through user generated content.
A Chattanooga paddle board rental and adventure gear company, L2 Outside, will re-post customers who have either gotten a rental or bought some of their clothing, and shared that on social media.
When L2 does this, they do two things:
They are giving gratitude to their customers, and they are showing all of their customers' friends what fun their customers are having.
This is also a great way to fill up your content schedule.
How do you share these rewards?
It’s great to offer customer rewards, but you have to actually get people to use them. How? Here are five ways.
1. Use physical mail to send rewards and packages.
This one is a bit old-school, but it’s a great option for sharing rewards. You see companies send coupons in the mail all the time. The ones I get most are right after an oil change, when they send me a coupon for my next one.
Mail is also a great way to send something big. Vans will sometimes send out a loyalty box with goodies such as a water bottle, backpack, hat, and stickers, just for being a member of their rewards program.
Then their customers will post it on social media for others to see, and starts a positive chain event.
2. Send rewards and opportunities through Email.
If you searched through your email right now, you could probably find several offers from a variety of businesses. Here’s an example - Regal movie theater will send you upcoming opportunities to earn extra points.
Email is easy to send, and the ROI can be great. However, email can also get easily get lost, missed, or sent to spam. You can also use email to tell customers about expiring rewards.
3. Text updates, promos, and images.
With a 99% open rate, text messaging is one of the best ways to ensure your message is seen. Use it to send quick messages like:
- Rewards balances
- A link to a sales page
- And anything else
Texting can often replace email when it comes to simple messages, or you can use it in conjunction with email. Here's an example that drives traffic and sales:
Texts are also great for giving out a random freebie. Text out a promotion to your contacts, and have the ones who reply be entered into a giveaway.
Through Text Request, you can also schedule texts to go out on contacts' birthdays notifying them of a free birthday gift.
4. Utilize in-app notices to make things convenient and personal.
If you have an app, you really need to be utilizing in-app notices like push notification and banners. It's a great resource for your customers and makes the experience personal for them.
Starbucks does a good job of using their app to notify customers of rewards and other things.
However, building an app for the sole purpose of rewards probably isn’t a good choice for most businesses. It’s expensive, and the adoption rate is very low.
5. Grab attention with in-store notices.
In-store notices are a great way to grab the attention of new and existing customers. REI Co-op, for instance, has a membership program that costs $20. When you sign up in store, they give you a $20 gift card to use the next time you visit.
Another great example is a retail company asking in-store customers to post on social media with the company's products. Maybe customers will get a chance to win a free product, earn a discount the next time they buy, or to be featured by the company.
What is the best choice?
The best choice is going to be a combination of several rewards options and distribution methods. That’s what will create the most engagement with the highest ROI.
If you are in the service industry like HVAC repair or roofing, using a loyalty program for these long term purchases would best be delivered through physical mail, so they have something to hold on to. You can also use seasonal email or texts.
A CPA firm can use email and texting to remind and prepare customers for the upcoming tax season. You could also use it to offer them a reward for filing with you again, or a free consultation to discuss their options.
In retail, if you don’t already have an app, sending notifications and coupons via text will bring you great results. Combine this with the occasional emailed coupon, in-store notice, and social media shout-out to increase sales and engagement.
If you do have an app, utilize those in-app notifications, and use email to send extra little coupons or birthday wishes.
For the best open and read rates, texting is going to be the best hands down. When it comes to cost, in-store notices are the cheapest.
However, there is no one right answer, and the only wrong answer is not using them at all.