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Increase Your Customer's Loyalty

Posted by admin on 3/27/13 11:00 PM
Topics: college store customer service, MBS Systems Loyalty Module, customer loyalty

The following is an excerpt from the article Master the Art of Customer Loyalty written by Victor Ho, CEO and Co-Founder of FiveStars, and published on View the full article to see more tips on developing loyalty with your customers.

For many small businesses, loyalty marketing may be the only marketing they need, because it builds upon their greatest asset: their most satisfied customers. Bain & Company famously wrote that it costs 6 to 7 times more to acquire a new customer than to retain an existing one. Though you probably can’t invest in loyalty like a Fortune 500 company would, there are steps small businesses can take to begin loyalty marketing.

First, invest in service. Zappos pioneered the mantra that customer service is the new marketing. An American Express study showed that 70 percent of Americans would spend more with companies they believe provide excellent customer service. Service is the strength of most small businesses, so you should be able to do this well immediately.

Second, build a robust loyalty program that:

  • Increases Customer Visits. Remember the first time you joined an airline frequent flyer program? Initially you were probably comfortable spreading your miles across a few airlines, but as you neared a reward in one, you started to stick with your preferred airline. And then once you experienced the benefits of airline status, you were hooked. When you build your loyalty program, make the first reward easily attainable, so customers experience the thrill of getting a reward early on. Then add additional tiers to earn even more memorable rewards and maybe bonuses after a certain number of visits. Even if you use a simple punch card, you should be able to launch this kind of program. Companies that implement simple visit-based loyalty programs can increase customer visits by 30 percent with very little cost.
  • Increases Spend Per Visit. As a second step, consider rewarding customers not just based on visits but spend. For example, if you are a restaurant, give a point for every $5 in spend. This encourages customers to not only come more frequently but also spend more per visit. This has a multiplicative impact on sales.
  • Increases Revenue from Promotions. Fortune 500 companies love loyalty program signups because you are no longer just an anonymous customer to them. Once you’ve joined, they have your contact info and can reach you with promotions. Do you collect emails when you sign up customers to your loyalty program? It’s a small step that will give you an additional revenue stream when you send them relevant promotions on holidays or special events.

Does your store offer a loyalty program? If so, what structure do you use to reward customers? Share your experiences in the comments section.


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