5 Reasons Why a Loyalty Program is a Crucial Small Business Strategy

Loyalty programs are nothing new to the large, recognized brands of the world, but lately, small businesses are discovering the wide range of benefits that result from providing their customers with a rewards system.

While many small businesses remain more focused on growing their customer base than improving services to their existing clients, there are 5 important reasons why a well-structured loyalty program is a key small business strategy, now more than ever.

1. It’s Easier to Retain Existing Customers Than it is to Find New Ones

Keeping existing customers is exponentially easier, less expensive, and more advantageous than finding new ones. In fact, increasing retention rates by 5 percent have been shown to increase profits anywhere from 25 to 95 percent. Furthermore, a recent study from Simon Fraser University clearly concluded that attracting a new customer costs 5 times more than keeping existing ones.

2. Repeat Customers Spend More Money

A recent survey of 1,000 small businesses revealed that 61 percent receive half of their annual revenues from repeat customers and that those loyal customers spend 67 percent more than new ones. As a result, small business owners should be shifting their focus away from customer acquisition and toward customer retention.

3. Competition is Fierce

Retaining customers is a tough feat for any small or medium-sized business owner in today’s environment, especially for those competing with brands that have more locations, resources, and money to spend on marketing. In order for small firms to compete at their level, it is vital they at least remain on par, if not exceed the “perks” offered by their competition. One of the simplest ways for small businesses to do so is through a rewards program.

4. Consumers Love Reward Programs

As of 2015, the average consumer has 6.4 loyalty rewards cards in their wallet, and 63 percent say they are more likely to engage with a brand that has a loyalty program. Furthermore, a vast majority of Canadians will shop strategically to earn points.

5. Loyalty Programs Don’t Need to Be Expensive

Loyalty rewards programs, especially those designed with the small business owner in mind, tend to be much more affordable and effective than other marketing strategies. Though punch cards are common for small companies, many consumers prefer a mobile-based solution to wasting more of their precious wallet space. Fortunately, there are a wide variety of digital solutions that can increase customer retention while providing valuable customer insights for a low monthly cost.

10 Reasons Why You Need a Web Presence for Your Business

Reason #1 – Online Brochure

Web Presence

Companies spend millions creating brochures and distributing them every year. By having a website you can skip that entirely. Your potential customers can find out about you and any of your products or services online. If you get most of your business through networking and personal connections, then potential customers will want to check out your website.

Reason #2 – More Customers

Billions of people use the internet every day, and some 90% of those have purchased something, or contacted a company, online in the last 12 months. So by not having a website, you’ll be missing the bus.

Reason #3 – Business Value

Have you tried getting a business loan recently? It’s not easy, but if you try and the bank manager asks to see your website, you better have a pretty good one. It doesn’t just stop with the bank; the perceived value of your business will be lower in everyone’s eyes – especially your customers – if you do not have a well-established web presence.

Reason #4 – Influence

By having a website potentially thousands of people are going to see it. You are able to influence people’s decisions and educate them.

Reason #5 – Helps with Business Goals

When it comes to writing the content for your website, you are going to revisit things about your business that you haven’t in years. You will most likely reassess your business goals, and that can be a very good thing.

Reason #6 – Low Barriers of Entry

Ever wanted to start a business? Well, now you can do it with virtual space at far below the cost of a brick-and-mortar setup.

Reason #7 – 24 Hours per Day

Your website runs 24/7 without any supervision or needs to lock it up. You will always be there for your customers.

Reason #8 – Communication with Customers

By having a simple blog or even just a feed on your website, you can update customers on your newest offers, products, promotions, events, photos, or any other content.

Reason #9 – Marketing

The internet has opened up a whole new world of marketing that didn’t exist before. Your website can attract new business by using a whole host of low-cost marketing techniques.

Reason #10 – Customer Support

You can greatly reduce the cost of customer support by having a ticketing system, or even just an FAQ on your website.