Why Customer Loyalty Programs Work

by: Nichole Gunn April 2, 2014

The customer loyalty program is as universally recognized and accepted as sliced bread. It’s practically a household fixture. In fact, you can’t even buy anything at a store nowadays without being asked what your customer loyalty program member ID or a corresponding phone number is so you can get your loyalty rewards. Grocery stores, airlines, car dealers, and even movie theaters love keeping their customer loyalty program, and thus their brand, fresh in your mind so you return, get your loyalty rewards, and continue spending your money with them. Let's look at the data to better understand why customer loyalty programs work.

Customer loyalty programs also allow you to collect customer and demographic data by simply having participants enroll. You don’t have to do studies, or go knocking door to door… your customers just sign up and tell you everything about themselves. It’s easy.

Still not sold? Here’s a little hard data on customer loyalty programs:

  • Customer loyalty program membership rates have grown at a rate of 26.7% over the past 10 years. There are roughly 2.65 billion loyalty memberships that are active in the United States alone.
  • 84% of consumers are more likely to visit the website of a company with a customer loyalty program than one without.
  • Customer loyalty programs increase brand market share by up to as much as 20%.

Customers, just like every other “buyer” in the world, have what’s called a decision funnel they move down when deciding who to buy from. They do research, they evaluate, and they decide. Having a well thought out, well executed, and well marketed customer loyalty program in place simply helps them decide to go with your brand over your competitors. It makes the decision funnel flow your way, which is what your end result should always be.

Here at Incentive Solutions we’ve been crafting successful customer loyalty programs for decades. One of our favorite things is hearing about client success stories, so that’s what we make sure to produce every time – success. If you’d like to know more about how to start a customer loyalty program of your own, call us today at 1-866-567-7432 and schedule a test-drive of our system.

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