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Monday, July 8, 2013

What Gets Rewarded Gets What?

      My tip this week comes from a message from one of our loyal listeners. DanaLynn, or you may know her as FunFancy nails messaged me for some advice. She writes" I won a whole year supply of Tammy Taylor supplies and wanted to do something in return- kinda like paying it forward. I decided to give a free full-set of acrylic enhancements every month. I mentioned it to a client and the response I got was "well that doesn't help your current clients".
      For my current clients I have a loyalty program for them. After 10 stamps they receive $30 to be used towards any service. I also send them a $5 "D" dollars for their birthday and for their anniversary date with me. I think that's plenty! What are your thoughts? I messaged back I think that's plenty too..but I can see how they might feel left out of the "Tammy" gifts. Maybe your current clients can go in a pool and pick a winner once a quarter for a free fill...until you run out of product. So this conversation got me thinking about loyalty programs again. I know I have shared my thoughts about them before but they are worth revisiting with new data and research.

      It's been said what gets rewarded gets repeated. Are you rewarding your clients? Loyalty programs make your clients feel special and after all don't we all just want to feel special? According to Colloquy, a marketing firm specializing in loyalty programs, loyalty memberships exceeded 2 billion in the United states alone, that works out to about 18 per household through 2010, up 17% from 2008. They also estimate that an astounding $48 billion worth of rewards are handed out annually.
According to Belly, a national loyalty program,
88% Of businesses with loyalty programs are more profitable than competitors who do not.
65% Of customers say they would recommend a business because of a rewards program.
73% Of customers want a universal loyalty solution where they shop.
46% Of customers have increased frequency of visits for a business with a rewards program.

     Many solo nail businesses don't have the means to afford a high end loyalty rewards program or the technology to track it. So Keep It Simple Sweetie. A punch card works great and it's easy peasy. 10 punches gets a free polish change. or something like that. Never give away your bread and butter, to those that are already on board. Make the reward for a service you are trying to promote, or a person you are trying to build. Be on purpose with your rewards. Remember though the average margin for profit hovers around 10% when all is said and done and paid so make sure you are not giving away all your profits. If you are in a plaza you can have loyalty cards printed up and sold in each business. Try and get 100% participation from each business to encourage your clients to shop there more often.
     This Chicago based company called Belly is building huge loyalty program that you can earn points to other businesses as well. They provide all the technology, an Ipad for your business as well as a mobile app and have plans that range from 79-149 dollars per month to have a turn key mobile rewards program. It's kind of fourquare on shopping steroids. Check it our online and check out more about rewards programs on my blog, Adventures of a probeauty girl and of course my books now on because that's smart marketing!

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