In the last couple of years, the rise of social rewards programs has changed the way we do business. Social media and mobile technology have led to a shift in both consumer behavior and expectations. Today, loyal customers expect more than just personalized service. More than ever, consumers are demanding that brands give back. They expect brands to remember their preferences and reward them for their loyalty.
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Rewards programs are important for brands because they encourage customer loyalty, help track spending patterns, and provide valuable feedback. By offering rewards, brands can foster a sense of community and connection with their customers that goes beyond the simple exchange of goods or services for money.
Traditional social rewards programs can be costly and time-consuming to maintain because they require a significant amount of business and customer resources for tracking, awarding, and redistributing points or rewards. For example, brands must spend time and money restructuring point systems and redemption options, for tracking and redeeming points or rewards.
Let’s take a look at what customer loyalty is and why it’s important to have an effective social rewards program.
What is customer loyalty and why is it so important?
Due to ever-changing buyer habits, customer loyalty is no longer a sure bet, so it’s more important than ever to cultivate it. When clients are loyal to a particular brand, their purchasing decision, the product’s price and/or product availability aren’t deciding factors. They would rather wait longer or pay more to purchase the product they are familiar with and appreciate.
A well-designed and implemented loyalty program has a high positive impact on your business and brand, shown to increase average order value (AOV). It is a proven incentive to keep customers coming back to your brand over competitors. Now, let’s take a look at the benefits to your brand after implementing a social rewards program.
1. Social rewards programs encourage customer loyalty and provide valuable feedback to brands.
Incentivizing customers with rewards is a time-honored way of encouraging loyalty, which works. According to a recent report by Forbes, “82% of respondents said they are more likely to shop with retailers who offer some type of customer loyalty program.” The same report found that “two-thirds (67%) would even choose one retailer over another based on the strength of their customer loyalty program. ” So if you want your customers to stick around, it makes sense to give them an incentive.
2. Rewards programs can also provide insight into how customers spend their money, which can be useful in informing future marketing and product development efforts.
Though many people think of rewards programs as simply a way to get discounts or freebies, they can actually provide valuable insights into customer behavior. By tracking how customers spend their money and what kinds of rewards they redeem, brands can better understand what motivates their spending. This information can help to tailor future marketing and product development efforts. In today’s competitive marketplace, brands need all the help they can get in understanding their customers. Rewards programs can be an important tool in this effort, and one that more brands should consider taking advantage of.
3. By offering rewards, brands can foster a sense of brand community and connection with their customers that goes beyond the simple exchange of goods or services for money.
In a customer-centric society, it is important for brands to foster relationships with their customers and this can be done with social rewards programs. By offering rewards, brands can express appreciation to their customers and encourage them to keep supporting them. Additionally, rewards programs can help brands build brand loyalty among their customer base.
4. Rewards programs help you reach new customers
It’s been said many times before, but worth saying again: satisfied customers are one of your most powerful marketing tools. They’re essential to attracting new customers — in fact, 83% of consumers place more trust in personal recommendations than any other form of marketing. The McKinsey study showed that referrals generate two times the sales of paid advertising. And with a well-designed social rewards program, incentivizing referrals, and rewarding customers who invite new shoppers, you can expand your customer base cheaply and productively.
How to create a good reward program?
Successful loyalty programs are not easy to create, but the right steps will put you ahead of your competition and give you great results. It is a challenge, but there are certain steps you can take to be ahead of the competition and generate great outcomes. Our recent article ‘Anatomy Of A Social Rewards Page’ will walk you through some social rewards programs examples and basic principles on how to start with a Social Rewards Page on LoudCrowd.
The Importance of Social Media in Rewards Programs
When you want to expand your brand, social media is an excellent option. Whether your brand existed before social media, it’s counter-intuitive to ignore the opportunity to get your product out there. If you are rewarding your customers with products through social media, then you will also be attracting new followers. With the increase in viral marketing and content creation, there is a possibility that your brand will get seen by the whole world.
The rise of digital channels has forced major shifts in the way brands interact with their customers, and social media is one of the many touchpoints that brands use to stay connected with customers. While millennials may not account for the majority of social media usage, they are a powerful group to pay attention to. Statistics show that 95% of people aged between 18 and 34 follow at least one brand on social media. Moreover, this information can be useful for brands to design a price strategy and discount strategy by looking at users’ preferences, reactions, reviews, and feedback.
Many brands view loyalty programs as a rewards system, but they can do so much more. A loyalty program isn’t just about staying engaged with customers, it can also provide an opportunity to delight them and connect with them in a deeper way. The process of rewarding customers offers many opportunities for you to create trust with them, deliver a memorable customer experience, and deepen their commitment to your brand. In the end, social rewards programs are about relationships and the value of relationships.