Gaby Awad - “Buying Customers”
S4 Episode 8: The Customer Loyalty Journey
My name is Gaby Awad AKA The Coach on Wheels (you have to watch my YouTube channel to know why 😉), and I am your host for the BUYING CUSTOMERS radio show 🔥🔥🔥
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In this “Buying Customers” Episode 8 of Season 4, we are going to talk about Building your Customer Loyalty Journey. So we are going to talk about the strategies to plan, build, and maintain customers…
Once we finish our talk today, you should be able to know exactly how to put together strategies that work, yet don’t cut into your profit margins. More importantly, you’ll have a selection of developed strategies to choose from. This is the next step in your marketing success story. From this point on, you’ll have the skills to keep your customers coming back for more. I personally guarantee it.
At the end, we will jump straight in and start going through ‘The 6 Steps To Creating A Successful Loyalty Strategy’.
You might be surprised by how much this exercise reveals about your business. It may get you thinking about important issues that have never crossed your mind. If some of this information is new to you, don’t be concerned - there’s never been a better time to make them most of your current customers.
What You Need to Know
Let’s Jump Immediately into The 6 Steps To Creating A Successful Loyalty Strategy
1. Why (Use A Loyalty System)?
Before doing anything, you need to work out whether a loyalty strategy is the right thing for your business. Obviously, you have a suspicion that it is, but you need to compare it’s potential returns against promotional methods you could invest your time and money in.
Let’s look at your business in a little more depth. For a loyalty program to work, you should ideally meet the following criteria ...
Frequently Purchased Product: Hairdressers, restaurants and groceries are all excellent examples. On the other hand, real estate agents and car dealers are examples of businesses that will struggle with a loyalty campaign. It’s so long ‘between drinks’ - people will forget who you are. There are things you can do to remind them, but a loyalty card will be all but meaningless - you can’t expect people to hold onto it for 25 years.
Floating Customers: If all of your customers are already loyal, there’s no real point in offering them anything else.
Also, petrol stations are ideal for a loyalty program- they have a frequently purchased product and floating customer base. But, there is no margin in petrol, and thus, no chance of offering anything worthwhile. They could offer $1 off every 10th purchase of fuel, but who’s gonna care?
And, if your product or service has flaws in it, you’ll do more to damage your reputation than enhance it. Added to that, people will not make use of your loyalty system. They’ll try you once then leave you for someone who can deliver what they promise. Get your quality up, then worry about getting your customers back.
2. Who (Are Your Target Market)?
Before you even buy the envelopes for your Direct Mail campaign you need to identify exactly who it is you’re trying to reach. Precisely who is your target market?
A failure to answer this question will cost you hundreds in wasted dollars and lead to a poor conversion rate. For example, imagine a company who sells in-ground swimming pools doing a mailing campaign to a block of high-rise rental apartments. To avoid costly mistakes, you need to know who your potential customers are before you start mailing your letters out.
Knowing your target market will also enable you to write in a way that your prospect will relate to. Using terms and phrases that are commonly used by your prospects will greatly increase the effectiveness of your letters.
So who are the people most likely to be interested in your product or service. Here are some guidelines
Age: How old are they? Don’t just say ‘all ages’ or ‘a variety’. We want to create a mental picture of your average customer. Think of an age that symbolizes most of your customers.
Sex: Are they male or female? ‘Half and half ’ is too broad. Practically every business is split one way or the other. Give it some real thought - which gender does business with you currently.
Income: How much do they make? Do they earn a great living, meaning that quality is the big issue, or are they looking for every deal. It’s essential that you find this out.
Where do they live: Are they local, or do they come from miles around to deal with you? This will dictate how you communicate with them.
Step 3. What (Can you Offer Them)?
If you really want your loyalty system to work, you need to do two things ...
1) Do everything you can to improve your product or service. Give the best quality you can for the price you are selling for, and take the time to improve your service, build rapport and be genuinely interested in what the customer wants. This is the best way to ever build loyalty.
2) Work out what you can offer the customer for their loyalty. This will give them the feeling of being part of something special, and let them know that they are valued. It also gives them the idea that they are ‘spoken for’. For example, imagine a florist that offers a free carnation,
sent to anyone in the local area, every time a VIP member orders. When another florist comes along making offers, the customer will block them out - they already ‘belong’ to a florist.
Ok, so how do you work out what you can offer your customers? It has to be appealing, generous yet not heavily cut into your profit margin.
Here are some options ...
• A free service or product ...
• Free delivery ...
• Something extra with every sale ...
• A free service with another non-competitive business ...
• Give your customers the VIP treatment -perhaps they’ll receive a complimentary muffin and cup of coffee while they wait, plus any magazine of their choice.
4. How (Do You Create A System That Works)?
A good customer will not only bring you income, but also stacks of referrals. Once a customer ‘commits’ to a business, they have no problem sending their friends.
If your customers almost always come to you once and then are never seen again, you have to give some real thought to the quality of your service and product.
People are ‘once bitten, twice shy’. If you burn them once, all the loyalty cards and incentives in the world will probably not bring them back.
People are often surprised when you tell them about your loyalty system. They expected to just float in, get what they need, then float out again. Suddenly, you’re saying to them ‘hey you, we want you as a customer - that means commitment, an exclusive relationship’.
People are usually a little taken aback - ‘I didn’t think you even noticed me here’ they’re thinking. That’s unfortunately how it is - most customers feel unnoticed. They’re just another number. A loyalty card has the benefit of making the customer feel special.
Here are a variety of different ways to work your loyalty system:
A) Every 6th service free… this is ideal for mechanics, hairdressers, restaurants, any business where customers have to come back regularly. The way it works is simple you give the customer a card. They get it stamped each time they visit. On their 6th visit, the meal, service or product is free.
B) Credit dollar system ... people are given a card. When they present their card, they receive credit dollars for their purchase.
C) Points System ... Every time the customer spends, they accumulate points. For example, $10 may equal 100 points. When the customer reaches a certain number of points, they can spend them on something. They may conserve their points, and use them towards something better.
D) Extra service perks ... take the example of the mechanic before. Each time the customer came in, they got extra stuff - cake, cappuccino, special smelling oils for their car...
E) Send gifts and thank you cards ... this is a good one if your profit margin is low, your customers are already loyal or you only see your customers every couple of years or so.
So once you’ve decided upon the loyalty system that you believe will work best for you, you now have to decide how to promote it to your customers.
5. When (To Introduce People To The Loyalty Strategy)
Once you’ve worked out what you’re prepared to give your customers in exchange for their loyalty, you need to work out when the ideal time is to introduce them to the loyalty system. In some cases, you need to do it on their first visit. This needs to be done delicately.
You can’t really say ‘I know this is the first time I’ve seen you, but I think of you as one of our most important customers’. People will see right through that.
If you’re going to hit people with the idea straight away, it has to be more a ‘regular customer card’ or ‘frequent buyers rewards program’.
If you have a suspicion that many of your customers come to you once, find out that you don’t do anything special and then leave you for someone else, you need to get them straight away.
If you get people coming back pretty regularly anyway, it may be worth delaying the card until later. Then it can be called a VIP Card or a Special Customer Card. It will have the impact of encouraging them to come back more often.
Step 6 is: What else (do you need to think about)?
Use this as a final checklist - once you’re happy with your loyalty strategy, run through and make sure you’re ready to get started. Here are a few things you may not have thought of ...
Staff Training: Do your staff fully understand the strategy you’ve implemented? It’s important that they understand the vital role they are to play in this strategy.
Check Stock and Staff Levels: It’s unlikely your loyalty campaign will bring in hundreds of extra sales (very few actually do), but you need to be prepared for a sizeable response. There would be nothing worse than having a rush of extra sales only to find you have no stock or are too busy to take advantage..
What You Need to Do
Step 1: Test and Measure Readiness. This means you should be ready to change your mindset from ad-hoc to test & measure everything. In this stage you it’s essential that you meticulously define every result you want to capture against your customer loyalty goals. It’s extra work, but you’ll be glad when you have a marketing strategy which you know will produce results. That confidence only comes from testing and measuring.
Step 2: Know what to offer. Assess your financials and your offers to know what you can afford as rewarding your customers. Then, revisit your target market or niche and ask yourself the question: who should benefit from my loyalty program?
And what can I offer them… something of value that will create a WOW experience.
Step 3: Create awareness… Once your program is defined, you need to make sure that every person you come in contact with in your marketing and sales processes knows that it’s available, and is offered one. This means you have to prepare visuals for in-store brochures or flyers, train your team to always mention the loyalty program and review your digital marketing to embed the copy, terms, and benefits of the loyalty program you are going to launch.
Step 4: Launch the Program. During the first months of the launch and again test and measure everything from satisfaction to numbers, perceived benefits, and increase in number of transactions. If the numbers are not satisfactory now is the time to change and re-adjust your loyalty system. During this step, remember to ask every customer ‘are you a member of our loyalty program?’. If they say no, you tell them why they should be. If they say yes, you say ‘great, let me swipe your card’, then offer a reminder of the benefits. Remember, people need to be trained - you need to give positive reinforcement every time they do what you want them to do.
Step 5: Revisit your Customer Buying Journey. Your customer journey is mapped across all possible touchpoints with your prospects and clients. Here is an opportunity to look at all phases of the journey from Discovery to Exploration and Comparison down to Evaluation, Decision, Retention and Referral.
These are the main phases of your customer buying journey. Across all phases you should ask yourself: what are my touchpoints and how to embed the loyalty system at every phase and make the transition easy for the customer and my team to move the customer from discovery to loyalty.
At every phase of the buying journey ask yourself also what may they be thinking and feeling. Would they be uncertain or impressed? Would they be comparing prices or finding the value easily. Would they be happy with the service and promoting my business or telling all their friends not to buy from us?
Step 6: Improve your Customer Journey. Sit with your team and discuss every phase of the journey. Brainstorm, challenge, role play and take note of the things you need to improve to WOW your customer. A loyalty program does not create loyalty and raving fans unless you and your team are convinced that a wow factor should be embedded in every touch point of the customer journey. How we answer the phase makes a difference. How we welcome the client makes a difference, and how we service and support after their purchase makes a big difference.
Written by Gaby Awad
As a Business and Executive Coach, Gaby helps business owners, leaders, and teams grow and achieve their goals through alignment, business re-education, coaching, and mentoring. He has more than 25 years of experience in executive positions and transforming businesses. Currently, he is the Franchise Owner of ActionCOACH in Lebanon and in this position he also coaches Business Owners, CEOs and other top level executives. Gaby hold international accreditations as certified coach from ActionCOACH, Marshall Goldsmith, The John Maxwell Team, and Jeffrey Gitomer Sales Academy. Gaby is also the founder of Good Session Coaching, an online learning platform for executives and business professionals where leaders can go through self-paced learning.
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