10 Proven Customer Loyalty Programs for Small Businesses

So you aren’t a big business — yet. However, how you build and maintain your customer base can make a world of difference in the future of your company. Some may even argue that being a small business offers unique advantages.


For one, you’re in a position to have valuable and profound insights about your market, allowing you to deliver more satisfaction and relevance to your customers.


Another is you’re more agile and able to make changes more quickly and effectively than larger and more established companies.


Why not put those insights and that agility to use by rolling out a customer loyalty program? After all, there’s nothing like rewarding good customers so they become repeat customers.


In this guide, we bring together the best ideas for customer loyalty programs that are tailored towards small businesses like yours.


But first, let’s try to understand what a customer loyalty program is and how it’s different for small businesses.


What Is a Customer Loyalty Program?


A customer loyalty program or a rewards program is a strategy used to retain customers. It does so by rewarding existing customers for using the brand’s services or products. By employing effective and relevant customer loyalty programs, a company can look forward to increased and repeated sales from a loyal market.


As a small business, you might have hesitated in introducing customer loyalty programs because of limited resources. However, that’s no longer the case today. With advanced technology and digital tools, even small businesses can run loyalty programs.


Let’s look at ten customer loyalty programs that are perfect for small businesses.


10 Customer Loyalty Programs for Small Businesses


1. Memberships and Exclusive Offers


Offering memberships is one of the best ways to start a customer loyalty program. Provide “members only” exclusive deals to customers willing to participate. Additionally, you can also create tier-based membership offering higher rewards to those who do business with you more often and have more sizeable transactions.


It doesn’t just encourage repeat business but also builds your brand by creating greater awareness.


2. Loyalty Points


A point-based system can be integrated with almost all customer loyalty programs. Customers can easily sign up with an email or mobile number to start earning loyalty points.


Every purchase entitles them to a certain amount of points that will be determined by your point system.


Accumulated points can then be exchanged for discounts, freebies, and other incentives.


3. Mission-Based Programs


A mission-based program can help you become the talk of the town and do wonders for your PR. These types of programs don’t focus on getting your customers to make more purchases directly. They instead use an emotional approach to get customers to feel good or even proud of using your services.


If you offer products, you can work with a nonprofit and donate a percentage of your sales. If you offer services, you can provide your services to financially challenged communities that may really need them. Of course, employing such programs means reporting the donations, work, and services that you have done towards your chosen cause.


To maximize the relevance of such programs, it’s best to give it a lot of thought and choose a cause that resonates with your company and market.


By doing business with you, customers will feel like they’re contributing to society. This can help reduce customer turnover and give you a stronger competitive edge.


4. Punch Cards


Punch card programs might be old school but they are easy to implement as well. They're also easier for customers to understand and use.


Since many businesses use a punch card program, how can you make yours stand out?

Instead of offering the same old discounts on products and services, try offering complementary services, gifts, or freebies. You should also make the rewards and incentives clear so that customers will know what they’re getting and will feel more secure and motivated to use it.


5. Newsletter Offers


Since emails are easy to manage and almost all customers have access to one, why not get your customers to sign-up for regular newsletters from your company?


You don’t have to invest a lot to get your program running and your customers don’t have to do anything either.


Informed and loyal customers will regularly check your emails and you can reward them with exclusive offers.


6. Referral Programs


Referral programs provide many benefits for small businesses.


Start by offering discounts and rewards for your current customers who refer friends and family members. The people they refer also get discounts when referring other friends.

By maintaining and promoting a referral program, you can sustainably grow your business and expand your customer base.


Referral programs are great because they are highly customizable. You can increase discounts for customers who use your business a certain number of times or give them special offers for referring a high number of friends.


With a referral program, you’re only giving back to the customers who are helping your business which increases your ROI.


Taking all these benefits into account, a referral program is a relatively small investment of your time and money.


7. Give Customers, Discounts, Freebies, and Gifts


All customers have a birthday. Why not give them a gift, freebie, or a discount to celebrate?

This is a great pull strategy to get customers since they’re likely to shop on their birthdays anyway. Even if they weren’t planning to purchase from you, they’re less likely to turn down a discount that’s being offered just for them.


If your incentives are attractive enough, you’ll eventually have your customers anticipating your discounts on their birthdays every year.


8. Community Programs


A simple but effective option is to create a community program. This can be a shared space for your customers to review, comment, suggest, and discuss ideas about your products or services.


A community program isn’t incentive-based but value-based. It can make your customers feel heard, valued, and special. By sharing insights about your company, products, or services, you also increase the perceived value of your brand.


When people get together and rave about your products or services, share their experiences, and even challenges, you can address concerns directly, make appropriate changes and demonstrate that you’re a responsive company that genuinely cares about its customers.


Final Thoughts


Excited about starting your own loyalty program? Unless you’re just starting your business, there’s a good chance that you already have a loyal following out there. It’s now just a matter of implementing the right customer loyalty program to get them excited and motivate them to do more business with you.


If done right, a customer loyalty program can increase profits, reduce customer turnover, and retain customers while attracting new ones.


Need more business insights like this? Visit Loyent, a site with tons of useful resources for small businesses that also offers modern, contactless, point-of-sales solutions.

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