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This is the 1st in a series of articles we will be publishing relaying thoughts and concepts from the Net Retailer Conference in Chicago, which occurred June 5th by way of June 7th. Mark Goldstein, CEO of Loyalty Lab (a business that implements loyalty programs for merchants), and Gary Korotzer, CMO of Red Envelope (a firm that specializes in promoting gift items), delivered a presentation about loyalty programs. Red Envelope presently has a loyalty program managed by Loyalty Lab. Loyalty applications are taking off. If you have a retail web web site and you do not have some type of loyalty system...probabilities are that by the finish of next year you will. Jupiter Investigation expects that by the end of 2007, 78% of retailers doing company online will have a loyalty plan, compared to 24% now. So what is the big deal? worth reading It expenses a lot far more to generate a new buyer than to sell to a repeat client. Loyalty applications allow you to create a buyer base that is loyal to your goods, and will continue to purchase from you, rather than your competitors. A loyalty program is some sort of program that permits your clients to construct up credit to apply to additional purchases, or to redeem for money. For instance, a retail web web site could grant a consumer "points" for each obtain he tends to make. When he has adequate points, he can redeem them for a discount on far more merchandise, or possibly redeem them for cash. To implement a loyalty program, you need to have some way to maintain up with your customers' accrued points (or whatever sort of measurement you use). This must be accomplished by keeping records of a customers' transactions in a database. Goldstein and Korotzer encouraged tying the information to a customer's credit card quantity. Every time a consumer tends to make purchases with a distinct credit card, a record of the purchase is recorded along with the credit card quantity. In this situation, if a customer utilised a various card than in preceding purchases, her present loyalty account would not get added credits. You ought to try to make it straightforward for a client to know how a lot of points they have. Out of sight, out of mind, as the old saying goes, so make positive your buyers are aware of how several points they have and how several a lot more they want to redeem their rewards. When you begin the approach of deciding on the particulars of your loyalty program (precisely what participants will obtain, and how much they have to obtain for redemption), Goldstein and Korotzer argue that you ought to explore your company's economics as deeply as achievable. Two important statistics to examine are the lifetime worth and acquisition expense of your consumers. This will greater assist you figure out how a lot you can afford to give to your buyers. An additional vital consideration is specifically who gets to participate in the program. You may possibly decide on to only extend an invitation into the system to the prime 20% (or whatever percentage generates the majority of your revenue) of your customers. If there is a segment of your customer base that represents the majority of your income, then it makes sense to concentrate your marketing dollars on that group. An additional point that Goldstein and Korotzer emphasized is that your loyalty plan ought to be cross-channel. In other words, if you operate a physical retail location and take orders by phone in addition to your internet internet site, the loyalty program should extend to all of the channels. Stay away from confusing your customers. Make it simple for them to acquire credits and money in on their loyalty regardless of what channel they use to make purchases. Loyalty programs have been around for years in specific industries (i.e., airline frequent flyer miles) but are just starting to gain traction with a lot of retailers. If you sell retail, you must begin the method of researching the implementation of a loyalty program now - prior to your competition does. Really feel free of charge to contact Operate Media for information on implementing a loyalty program for your internet internet site.