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How Loyalty Programs Can Fuel Your Business Growth

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 How Loyalty Programs Can Fuel Your Business Growth
This article covers:
Customer Loyalty Programme
Steps to Building a Successful Customer Loyalty Programme

South African businesses are jumping on the loyalty program bandwagon, and for good reason! The market is booming, with a projected growth rate of 9.7% between 2024 and 2028. That's on top of the impressive 12.8% growth seen from 2019 to 2023. In other words, by 2028, the loyalty program spend market in South Africa is expected to reach a whopping US$556.7 million!

This in turn will make more happy customers and in turn more happy businesses.

Loyalty programs are a great way to keep people coming back for more, and building strong customer loyalty is key for businesses to thrive and profit in today's competitive market. Since repeat customers are significantly more likely to buy again, creating a positive shopping experience and implementing a loyalty program that rewards these loyal customers is a win-win. Not only will this incentivize repeat business, but it can also attract new customers through positive word-of-mouth.

Steps to Building a Successful Customer Loyalty Programme

While some loyalty programs excel at retaining existing customers, others can be designed to also attract new ones. Here are a few tips businesses can consider when building a customer loyalty and retention program that tackles both aspects.

1. Understand Your Customers

"... program managers need to understand who their consumers are before introducing an expiry rule which could seriously upset their most loyal customers.”
- Amanda Cromhout, founder and CEO of Truth, a Cape Town-based loyalty consultancy.

Building a customer loyalty program that really sticks, starts with understanding your customers like family. What makes them tick, what problems do they face, and how can your rewards become their personal superheroes?

Here's the thing: rewards are only as good as the value they bring. That's why getting to know your customers on a deeper level is crucial. Talk to them, and ask for their feedback – what are they loving (or hating) about your brand?  In today's digital world, this is easier than ever. Think of quick polls on social media, or a survey tucked into your monthly newsletter.  Every touchpoint you have with your customers is a chance to learn more – either with your e-commerce website, your Shopify store, or your mobile-friendly web application.

But here's the real magic: the insights you can glean from these tools! With MyDHL+, for example, we can see what destinations and types of packages are most popular. This tells us what matters to our customers, and lets us create even better experiences.  Imagine getting special shipping rates on your favorite products or items – that's the kind of loyalty program that builds a lasting relationship.

2. Choose A Loyalty Program that Complements Your Brand.

There are tons of ways to design one, and the best approach depends on your brand's vibe and what you offer. Here are some of the most popular loyalty program types to give you some inspiration:

  • Points Programs
    Customers earn points with every purchase, then cash them in for awesome rewards. This is a classic for a reason – it's simple and keeps people coming back for more. 
  • Cash Back Programs
    Similar to points, but with a twist – customers get real money back when they spend.  These programs often have minimum spending requirements, so they encourage bigger purchases. 
  • Tiered Loyalty Programs
    The more customers spend, the higher their tier and the sweeter the rewards. You can add a bit of gamification, to engage and make customers want to climb the loyalty ladder.
  • Value-Based Loyalty Programs
    This one's all about value that goes beyond just cash.  Think of exclusive online communities, networking events, or special appreciation experiences. It's a great way to build a deeper connection with your customers. 
  • Premium Loyalty Programs
    These are memberships with upfront fees, but here is the catch, the benefits are instant and awesome. Think of it as the VVIP pass you give to your customers to access the best offerings of your brand.

This type of loyalty program is mostly adopted by more economically active young South Africans under 25 years old, than just regular mass-market consumers.

 

3. Identify and Reward the Right Customer Behavior.

Not all customer actions deserve the same gold star. The best loyalty programs reward behaviors that align with your brand's biggest goals. Here are some ideas to get you started:

  • Social Butterfly Rewards: Want to be the life of the party on social media? Give points or perks for follows and likes!
  • Referral Rockstar: New customers are gold! Reward those who spread the word about your brand.
  • Signature Item Spotlight:  Have a product you want everyone to know about? Offer extra rewards for buying it.
  • Review Champions: Positive reviews are magic. Incentivize customers and give a shoutout to customers who leave glowing feedback.
  • Seasonal Spenders:  Looking to boost sales during a slow period? Offer special rewards for purchases made at specific times of year.
  • Big Spenders: Show some love to your high rollers! Reward customers who spend a certain amount with exclusive perks.

 

4. Making Your Loyalty Program Shine: Tracking Success.

So, you've launched your awesome loyalty program – high fives all around! But how do you know it's working its magic? Here's the deal: you have to track your success!

For a quick check-in, you can send out a survey and ask your customers straight up – what they think of the program, and see how your customers are feeling about the program. But if you're ready to deep dive, there are some powerful stats to track:

  • Customer Retention Rate: This shows how many customers keep coming back for more. A rising rate means your program is keeping them hooked!
  • Negative Churn Rate: This is the opposite of churn, and it tracks how many former customers are coming back thanks to your program. It shows your loyalty program's power to win back hearts!
  • Referral Traffic: Are your customers spreading the word? Tracking referral traffic shows how much buzz your program is generating.
  • Social Media Buzz: Is your program getting a thumbs up on social media? Monitoring mentions show how much customers love your program online.

5. Engage With A Reliable Logistics Partner.

​​Your loyalty program can be awesome, but here's the real deal: if your customers don't get their stuff fast and safe, those loyalty points won't mean a thing. Think about it:  shipping delays, lost packages, or damaged goods?  That's a recipe for customer frustration, not loyalty.

That's where a reliable logistics partner like DHL Express comes in.  We're the international express shipping experts, getting your deliveries anywhere in the world fast.  We offer a variety of options, from same-day service to guaranteed delivery times, all with that door-to-door convenience your customers crave.  Happy customers = a thriving loyalty program.

Ready to take your loyalty program to the next level?  Start by opening a business account with DHL Express.  Let's make sure your customers get what they ordered when they need it, so you can focus on building those rock-solid customer relationships.