Let’s face it, for every ten businesses that exist, eight or nine have some sort of owner retention or loyalty rewards program. While they used to be novel and exciting to a degree, customers are now used to them. They may well sign up. But, far too often, customers do so not because they are loyal, but because they happen to already be at that business. I heard dealers say many times why do I need a dealership rewards program my customers will come back anyway?
Too many companies use customer loyalty programs as a crutch, thinking if they give their customers something for free, or offer incentives, this will create loyalty. That viewpoint is wrong. A sound loyalty program is designed to enhance the customer experience, provide some form of value and to show the customer that you truly care about them. Often, loyalty programs aren’t as successful as anticipated solely because the customer experience falls far short of any reward the customer could possibly earn. Or the program presents customers with undesirable or irrelevant rewards and makes any that are desirable seemingly impossible to reach.
Well, if it’s not rewards, what actually does create a loyal customer? An article carried by Smart Company, gives an interesting example about a fish and chips restaurant that always gave customers an extra serving of fish. As customers got used to it, they started ordering one less than they wanted, knowing that the restaurant owner would give them an extra one – the exact amount they wanted. This practice actually had an adverse effect on the business, and it ended up losing money while failing to create customer loyalty. Why? Because the reward became…well…not a reward, but an expectation. To earn loyalty, the first and foremost item on your “to-do” list should be to create a great customer experience. Without a great experience, it doesn’t matter what rewards you offer or how many customers sign up. We know humans are complex, demanding creatures. They like free stuff, but it’s not what bonds a customer to a specific brand or to your dealership. Customers want the entire cake made with the ingredients of good customer service, value for their dollar, convenience, personal treatment and ease of use. The frosting on that cake is your loyalty program.
Loyalty programs have become integrated into our society. You probably belong to several yourself. The fact is that many customers would find it odd for businesses NOT to have one. However, simply offering one, and having one that is fully integrated it into a company culture based on an excellent customer experience, are two completely different things – and guess which one wins?
Rather than trying to leverage your loyalty program to create loyal customers, why not leverage your customer experience first, and then use your loyalty program to reward them? Now, that is a winning formula.
To learn more about dealership loyalty reward programs visit: https://performanceloyaltygroup.com