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Develop a customer loyalty program

Recognize your best customers so you can "pamper" them

Your best customers are those who generate more than average annual turnover for your company: they buy regularly and have been loyal to you for a long time.

Purchasing history: "RFM" variables
These three letters designate essential information which makes up the history of your commercial relations with your customers:

The Recency of the last purchase
It is very useful to measure your customer's loyalty by checking when his last purchase was.

The Frequency of purchasing
A client who buys often is naturally among your best customers and must be treated with maximum consideration.

The Monetary value of the purchases
The higher the amount, the more valuable the customer. Moreover, this indication lets you know in which price range to choose the products to offer.

Now see how to favor your customers:

• Give them preferential treatment
  They fully deserve to be singled out and have their status enhanced by special treatment. You can, for example, reserve a card for them, with special benefits: permanent reductions, free parking, privileged services, pre-views...
• "Buy" their loyalty
  You can also encourage customer loyalty by offering them, according to the frequency of their visits and/or the total amount of their purchases, a percentage of reduction which gets higher and higher, or gifts which rise progressively in value.
• Build up a personalized and interactive relationship with them
  Ask your customer to take a little time to tell you his personal preferences, his expectations and the means of fulfilling them. For example: by means of a questionnaire given to him or sent by mailshot or e-mail. Naturally, it is up to you afterwards to respond to the wishes expressed by your customers.

Charm your new customers to keep them

New customers are a particularly fragile segment of your clientele. You must therefore consolidate your relationship by reinforcing their decision to buy and to do this, set up a customer loyalty strategy from the very start.

Here are three different commercial approaches:

1. Roll out the red carpet for your new customers

How many companies turn on their charm to win over a customer, and then treat him with total indifference! On the contrary, you must save your warmest welcome for your new customers, seek to ascertain their expectations, anticipate possible reasons for dissatisfaction... Write to them, for example, in the days following their first purchase to make sure they were made welcome and were generally satisfied.

2. Show them from the beginning that their loyalty will bring them benefits

If you give your good customers particular benefits –reductions, privileged services ….- tell your new customers without delay. Prove it by encouraging them to renew their first purchase with a gift token, a reduction on another product, a sliding scale of prices...

3. Think "customer loyalty" as soon as you win customers over

When they prospect, most companies are looking for an immediate return, and do not think about the long term. The risk they take is of recruiting "passing" customers, who will never renew their purchase. A few simple precautions will allow you to improve the loyalty of new customers:
- Do not "promise too much" so as not to disappoint
- Do not attract people who are just looking, a source of potential disappointment
- Establish an atmosphere of confidence by offering concrete guarantees
- In all your communications, be courteous and considerate, as this will be a sign of a good relationship to come.

What means can you use to follow up inactive customers?

Your inactive customers are not necessarily lost. Short-lived situations, a harmless incident can bring about a break in relations which is rarely irreperable. It is therefore in your interest to follow them up to re-establish contact and start up a customer loyalty process.

Here are three different commercial moves:

1. Keep in touch with your former customers

A well managed file will tell you the date of their last purchase. Let your inactive customers know that you have noticed their absence and that you are sorry about it. "Throw them a line" by asking them if they have any reason to be dissatisfied with your services in terms of quality, delivery times... If need be, give them the opportunity to express their interest in your products/services again, for example by sending them a promotional mailshot.

2. Come back to them with a concrete promise

Recognize their status as former customers and, on this account, send them a convincing and appropriate offer. Use the information at your disposal: the date of their last visit, the type and value of their purchases to define this offer: a reduction on a complementary product or service, a free service, a clearance sale...

3. Never give up

Even if some of your former customers do not react to a first follow-up, do not be discouraged: try again with a new message, a new offer, a proposal for a personalized meeting...
This type of move helps to initiate a personalized relationship which you can build up in the framework of your customer loyalty development.

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