Today, the internet is an indispensable tool for researching and purchasing products. For customers, this means greater transparency with regard to the availability of products, prices and offers. At the same time, however, this also means an intensified competitive situation for companies. They have to compete for the attention and loyalty of their customers. In this context, bonus programmes can be an effective strategy to increase customer loyalty and encourage repeat purchases. In addition, there are other reasons that speak in favour of a bonus programme.
Increasing customer loyalty
Bonus programmes offer customers an incentive to shop only with a certain provider. By catering to the specific needs and preferences of customers, companies are perceived as particularly attractive. As customers are rewarded for certain behaviour and recognise the benefits for themselves, they remain loyal to the company.
In addition, a company with a modern incentive programme creates appreciation and trust among its customers. They recognise that the company is interested in a long-term customer relationship and places customer benefits at the forefront. In the long term, these points lead to an increase in customer loyalty.
Up- and cross-selling opportunities
Bonus programmes promote up-selling and cross-selling activities. Up-selling involves offering the customer a higher-value product, while cross-selling involves offering additional products that are compatible with the product already purchased.
By awarding bonus points for the purchase of higher-value products, companies can motivate their customers to spend more and thus increase sales. Customers in turn benefit from the additional bonus points they receive for these additional purchases. These points can later be exchanged for other rewards.
Reward programmes can also help to encourage customers to try additional products or services that they might not otherwise have considered. Rewarding customers with reward points can motivate them to try new products.
But recurring purchases also lead to an increase in sales. A bonus programme is therefore a very powerful tool for increasing sales.
Successful customer recovery
With personalised offers in the bonus programme, companies can not only reactivate inactive accounts or subscriptions, but also win back customers in a targeted manner. Through bonus points or special offers, companies can motivate their customers to return to their website and make further purchases. These incentives can take the form of special discounts, vouchers or free products, for example.
In addition, companies with a bonus programme show that they care about their customers and that feedback is important to them. When winning back customers, however, it is important to determine the exact purchase history and reasons for churn in order to be able to address the customer individually.
Increasing customer satisfaction
Customers have certain expectations of the brand when purchasing certain products. By participating in bonus programmes, these expectations are fulfilled over and above the normal offer. This creates a certain “wow effect” for the customer, as they were not previously expecting the special additional conditions.
But the points already mentioned in the previous sections are also reflected here. The customer feels valued in a special way and can also test new products without any problems.
Improved customer journey
A customer journey describes the process that a customer goes through in order to purchase a specific product or service. The customer’s journey is considered from the first contact with the company to the purchase and beyond. In other words, it is about the totality of all interactions and points of contact that a customer has with a company in order to make a purchase decision.
Incentive programmes have a positive influence on the customer journey and enhance the brand experience. By providing additional benefits and rewards, customers are given the feeling that the company understands and values their needs. This can help customers build a stronger emotional bond with the company. From initial customer contact to aftercare, loyalty programmes support the customer experience.
Strong competitive advantages
A loyalty programme can represent a competitive advantage as it helps customers to choose a particular company. Companies thus create a unique selling proposition (USP) and set themselves apart from the competition. By providing customers with special benefits, they recognise that buying the products here is particularly worthwhile.
But the aspects already mentioned, such as customer loyalty, customer satisfaction and testing new products, are also intertwined here. Companies use bonus programmes to create a special shopping experience and set themselves apart from the competition.
More attractive brand image
Brand image encompasses all aspects of a brand, including its products, services, marketing messages, online presence, customer service and other factors that can influence customer behaviour and opinions.
Through the use of modern loyalty programmes, companies specifically promote the individual aspects of the brand image. Additional positive associations are created in the minds of customers and perception is improved in an attractive way, which is also expressed in the point “improved customer journey”. Customers only receive special benefits and appreciation for their loyalty from this company.
Generation of important data
Loyalty programmes offer companies the opportunity to generate important information about their customers. They are a valuable source of the following customer data.
Purchasing behaviour: Bonus programmes provide information about which products customers buy, how often they shop and how much they spend. This data can help companies to better tailor their offerings to the needs of their customers.
Demographic data: Incentive schemes can also capture demographic data such as the age, gender and location of customers. This information helps to better understand the company’s target group and develop targeted marketing campaigns.
Customer feedback: Incentive schemes can also serve as a platform for customer feedback. Companies can ask their customers to provide feedback on products, services or the incentive programme itself in order to gain valuable insights and increase customer satisfaction.
Sales analysis: Rewards programmes can also help to analyse the company’s sales and profitability. By collecting data such as purchase frequency and revenue per customer, companies can recognise trends and adjust their business strategies to increase sales.
Improved customer communication
Loyalty programmes can improve customer communication by providing a platform to engage with customers and inform them of offers, rewards and news. Through regular and personalised communication, a company creates new points of contact to respond more specifically to customer needs.
For example, if an app is integrated into a bonus programme, companies can send push notifications. This allows participants to be informed more specifically about their status and new offers. At the same time, users are activated and engage more intensively with the programme.
Incentive systems can also help to make communication between companies and customers more transparent. By disclosing conditions and restrictions, customers can better understand how the bonus programme works and feel more secure in their communication.
Using customers as multipliers
A customer multiplier is a person or system that helps to increase the number of a company’s customers. A customer multiplier can help a company gain more customers in various ways. For example, a satisfied customer can encourage friends and family members to buy from the company as well. This in turn leads to growth in the customer base.
Bonus programmes ensure that customers recommend the company to others and thus act as multipliers. When customers talk about the rewards they have received for their loyalty to a company, they encourage others to shop there too. This leads to the company gaining new customers who decide to buy from the company based on the recommendation of an existing customer.
Increase the quality of market research
Similar to the point “Generation of important data”, bonus programmes provide valuable insights for market research. Customers can provide feedback on the company’s products and services. By rewarding customers for participating in surveys, reviews or product tests, companies can gain valuable insights into customer needs and preferences.
By additionally analysing the data from the rewards programme, the company can make better decisions about which products to offer and how to optimise its marketing strategies to better meet customer needs. But important data on customer behaviour also helps.
In addition, market research companies can increase their sample size through a bonus programme. This makes the market research results much more qualitative.
By collaborating with other companies and offering attractive bonus programmes, companies can be successful in the long term and increase customer loyalty and sales. In our blog post “B2E sales employee programmes: More success in sales”, we take a closer look at the topic.
Bonus programmes offer companies a wide range of benefits. They not only increase customer loyalty and satisfaction, but also the long-term success of the company.
This list is far from exhaustive and can be extended to other areas of the company. For example, if companies introduce bonus programmes for employees, there are further benefits. If you would like to find out more about how bonus programmes can have a positive impact on your company, please contact us. We will be happy to help you!
Coloyal is one of Europe’s leading providers of customer loyalty and incentive solutions. Founded in 2019 as part of a management buyout, the service provider is a former subsidiary of Arvato Bertelsmann and can look back on more than ten successful years in the field of consulting, CRM systems and rewards management.
Under the claim “Consult. Connect. Reward.“, Coloyal develops and implements individual, innovative loyalty solutions in the B2C, B2B and B2E sectors. Customers from all over the world include retail companies, airlines and railroads, financial service providers, insurance companies and consumer goods and automotive manufacturers.