If you have a loyalty program already, you know why it’s important. Retaining current customers is more valuable than acquiring new ones. Or, more specifically, spending money retaining new customers is more profitable than acquiring new ones. 

This is according to the Harvard Business Reviews which shares the claim that increasing spending on customer retention rates by a meagre 5% can reward you with a profit increase of between 25% and 95%.

If you have invested time and capital into your customer loyalty program, but are concerned that your ROI can’t cut the mustard, perhaps you are in need of a new one. Here, Social&Loyal provides you with 7 reasons this might be the case.


1. Not Enough Data

One of the key benefits of purchasing loyalty program software is so that you can find out information about your customers. It seems simple enough, but getting that information is only part of it. Having the right tools to analyze it properly is another.

Without sufficient data on your customer base, you are not going to be able to find out how to optimally implement your strategies, no matter how clever they are. This is because you run the risk of sending them to the wrong demographics.

One of the main reasons you don’t have the right data might be because you don’t have the right tools to collect it. An effective survey system to collect opinions, a promo code system which can send purchase information directly to your database and a QR code system are just three examples of important data collection tools. If your loyalty program software doesn’t have them, you may need to think about changing to a new one.


2. Unable to Send Communications

If your loyalty program doesn’t have the capacity to send communications directly to customers, then there is a big gap staring you in the face. Customer retention is key and having a direct link to them is incredibly valuable. It not only informs the customer, but it keeps you in their mind when away from their phone, computer, etc. With Social&Loyal’s gamified loyalty platform you are able to send emails, SMS messages and Facebook notifications. These Facebook notifications are a great way to get in front of the consumer in a location where they are already active and are likely to pay attention. Don’t risk getting your emails lost in their inbox, send them communications through multiple channels to ensure your customers will see your message.


3. Unable to Send Personalized Communications

Perhaps you do have direct access to your customers through communication channels. If you send them the wrong information, you might end up with a loyalty program strategy which is completely counterproductive.

If you send customers information which is of no interest to them, they can unsubscribe after the first annoying email. This goes to show that the difference between spam and promotion can be slight.

If you know their purchase history and have information on what areas they are interested in, your customer loyalty program should be able to personalize correspondence. It will make them feel valued and understood. More importantly, they can see how your brand fits in with their lifestyle.


4. Unable to Schedule Strategies

Running promotions like a photo contest or referral incentive can be great for business. They allow you to market to a customer’s wants and needs, creating traction for your brand and opening it up to potential new customers.

Unfortunately, if you are unable to keep your promotions on a tight schedule, you might end up wasting this potential. In business, timing is everything. If your customer loyalty program software doesn’t allow for a scheduling functionality, it can mean you miss a beat.

A good customer loyalty program will allow you to take the data it collects and filter it into a promotional schedule which works for the intended demographic. Relying on manual scheduling can be difficult with the vast amounts of information you’ll have to juggle to work out this schedule.


5. No Automatic Trigger for Communications

You will still need a keen marketing mind to successfully use your customer loyalty program. However, there is only so much you or your staff can take on without you losing ROI.

If you have implemented your customer loyalty program, it should be able to send automatic communications when a customer completes one of your objectives. This is only done when the previous strategies on collecting customer data are also operational. Otherwise you might end up sending the wrong information at the wrong time. Appropriate customer loyalty software should be able to prevent this also.


6. Doesn’t Have Adequate Social Media Capabilities

If your loyalty program doesn’t have social media built into its software, then it is out of date. As your business starts to become successful, you should start generating thousands of followers on all different social networking platforms.

Your social media strategy should include rewarding shares, participating in contests, riding viral waves and much more. Unless you aren’t yet successful enough, replying to every user individually is going to eat up a lot of time and money.

Loyalty program software which is doing its job properly should be doing this for you automatically. That way you can send out the right posts at the right time, cater your social media presence to your customers and make sure you don’t miss out on any vital strategies.


7. Weak Referral System

While retaining customers is also vital, your loyalty program software will not be sufficient if it misses out on the opportunity to attract new customers through them. This is where a healthy referral program comes in.

If you see that your platform isn’t growing, it is because you are not getting any new custom and therefore have no room for growth. A referral program will take the customer loyalty you have engendered through data analysis and make your brand worth talking about.

Your referral system needs to be consistent. If new customers are getting better deals, existing customers might feel short changed. Using your loyalty software, you should be able to keep on top of your referrals. You can do this with many of the aforementioned software abilities such as incorporating your social media platforms, sending out automatic communications and tailoring your brand to the individual.

Overall, your customer loyalty platform is only going to be effective if you put in the right amount of effort. A poor workman blames their tools. But, if that tool is deficient, getting a new one can make sure all that effort isn’t wasted.


If you want to learn more about switching to new loyalty program software then set up a quick call with our loyalty experts today! 

Sergi Renom
Software Engineer & Head of Customer Support

Popular Posts