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How to market a loyalty program effectively

Loyalty programs boost customer retention, but organizations must first convince customers to sign up. Marketers can incentivize referrals and use mobile apps to gain enrollment.

Customer loyalty programs can increase customer engagement and retention, improve customer lifetime value and boost revenue.

Loyalty programs can also relieve pressure from customer acquisition goals and let organizations treat new customer acquisition as a growth channel instead of a way to surpass revenue goals. After CX teams craft their programs, they must devise an enrollment strategy. Sign-up incentives, social media and gamified mobile apps can help brands market their loyalty programs and attract new members.

1. Encourage employees to promote the program

Organizations can encourage their biggest brand advocates -- their employees -- to promote loyalty programs. Employees have their own personal networks of friends and family they can tell about a new program, but they can also promote the loyalty program in their daily discussions with customers.

For instance, as customer success teams onboard new customers, they can share information about the loyalty program and its benefits. Also, sales agents can promote the program before or after they make a sale to entice the customer.

2. Promote the program to existing customers

Marketing teams should promote loyalty programs to their organization's existing customer base. This audience already engages with the organization and, as satisfied customers, they make prime candidates to market toward.

Marketers can email program announcements, benefits and offers to encourage customers to sign up. Also, employees like sales agents can email customers they have relationships with about the program, as customers often respond to personalized emails more than generic messages.

3. Offer sign-up incentives

Just as organizations use customer loyalty programs to incentivize frequent purchases, they should offer discounts, coupons and other rewards to incentivize the sign-up process. The same incentives that drive frequent purchases can drive program enrollment.

Loyalty programs also collect customer information, such as demographic data and purchase behavior, which can help marketers personalize future promotions. 

A chart that lists seven ways to market a loyalty program
Organizations can use social media, mobile apps and referral incentives to market their loyalty programs.

4. Use existing marketing assets to build awareness

Marketing teams can use their existing assets -- such as print collateral, emails, landing pages and company websites -- to promote loyalty programs on various channels. For instance, pop-up ads on websites and links in signature lines can educate customers about such programs. Marketing teams can use these assets to mention the program, how it works and how customers can join.

5. Use social media to drive engagement

Social media offers marketing teams access to a broad audience that includes prospective, existing and loyal customers. A loyalty program can encourage prospective customers on social media to make an initial purchase, especially when organizations incentivize signing up with a discount.

Also, social media marketing teams can use social media to market loyalty programs to existing customers, as loyal customers often follow their favorite brands to learn about new products and updates.

6. Use mobile apps to drive engagement

Mobile apps can help marketing teams promote their loyalty programs because they can increase customer engagement. For instance, mobile apps let marketers send push notifications about new offers to all users. Apps also let customers track loyalty points from their phones and can boost CX with gamification.

To gamify a loyalty program, a mobile app's UI can display how many loyalty points customers have earned and how many more they need to achieve their next rewards. These displays help people feel a sense of achievement as they move closer to exclusive offers, which can improve engagement.

7. Incentivize customers to refer others

CX teams should reward customers when they enroll in the loyalty program and make frequent purchases, but they should also incentivize them to refer friends and family. Loyalty members make a great referral channel because consumers trust people they know more than marketers.

Also, marketing teams can gamify the referral process on mobile apps to increase customer engagement and reward customers as they refer new members.

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