With the economy tightening the belts of consumers and merchants alike, more and more businesses are reducing expenses on important client and sales driving initiatives like promos, print ads, direct marketing and attending trade shows. Small businesses are finding it increasingly difficult to bring in and maintain active customers. This leaves merchants with a challenge: how to send the message that they want and need customers. One solution that many businesses may have overlooked is loyalty card marketing.



Since gift cards were one of the most-requested gifts this past holiday season, many merchants and retailers are now familiar with their impact. However, what's not as familiar to many small businesses is the impact that a good loyalty card program can produce. With the cost of bringing in a new client or customer often 10 times that of retaining existing customers, it is important to focus on how you can keep your present customer base coming back again and again. This is what loyalty card marketing is for.

The goal of loyalty card marketing is a simple one: showing added value to your current customer base and incenting and motivating the less-active customers to return more. A well-designed loyalty program will not only give the customer something of increased value, but it also provides the business with important data that can be used to drive more and more sales. Learning more about the purchase patterns of your most prized customers is valuable insight that you can capitalize on.

Flexibility is one of the more attractive features of a loyalty program. Campaigns can be designed according to economics of the merchant providing it. Take a furniture retailer, for example, with customers who buy bigger-ticket/high-profit items. They decide to launch a "Mystery Shopper" promotion that gives their customers cards that range in value from $20 to $800 off the customer's next purchase. They mail the cards to its clients, and clients must come to the store to find the dollar amount on each card.

This promotion is successful because consumers consider it a "game" of sorts that can lead to a substantial discount. Merchants like this promotion because it enables them to strictly control the number of cards with a particular discount amount. And here's a tip: advertise the "range of value" to be, for example, $10 to $1,000, but only create a few $10 cards with $20 being the most popular low-end discount. This way, almost every consumer considers himself or herself a "winner," achieving something in excess of the lowest-valued discount.

A very different tactic may be taken by a restaurant which has a different rate of purchase and a different price-point. In this case, a restaurant may wish to develop a reward program using points. For every dollar spent at the restaurant, a point is earned for the consumer. All of this can be easily tracked and automated to print the consumer's point totals and prize notification onto their receipts. As prizes like a free drink or meal are earned and redeemed and the consumer's rate of purchase goes up, the restaurant begins to established a tighter relationship with this consumer -- one that becomes harder and harder for its competition to break.

Another tip: keep your program easy to understand for both employees and customers. Make a dollar worth one point so calculations are easier for customers to understand -- they'll use the program more often if it is easy to understand and execute, and your store personnel will find it easier to explain and sell.

Make sure your loyalty program reaches your customers. Good things happen to those who properly promote their campaigns. Give your loyalty program play in your newsletters, emails and on register receipts. Build awareness by using table tents, posters and other in-store and point-of-sale display pieces. Take advantage of those communication vehicles and advertising space you already have established.

It is difficult to survive in such a challenging economic environment, but often opportunities can arise from adverse conditions. Loyalty marketing is no exception. Consumers are looking for value anywhere they can find it. If you already have a loyal customer base, you are fortunate. Take it one step further and give those loyal customers another reason not to shop elsewhere.