The business arena is fast-paced, which means that many businesses are diving into the industry to offer new products and services. Regardless of how new you think your offerings are, more often than not, several other businesses have already used the same idea to thrive in the market. In fact, most of your competitors might have already dominated the market even before your business existed.
Implementing a membership program for your customers can be a great way to level out the competition and stand out in any business industry. Usually, membership programs are part of a customer retention strategy wherein the business offers rewards to customers who often make purchases from them. This membership program can include free merchandise, coupons, rewards, and advanced released products. Product and service-oriented businesses can easily create and implement a membership program for their customers.
If you’re a neophyte in the business arena or have plans in getting into the industry, listed below are the reasons why you should definitely have a membership program for your customers:
1. You’ll Gather Valuable Data.
One of the biggest mistakes businesses tend to make is to attempt to cater to the demands of every customer in the world. They think that the more people they accommodate, the more profits they can earn over a shorter span of time. This might be true to some extent, but when applied in the business context, achieving this goal can put money down the drain. How can you possibly reach out to every human being in the world? Do you actually know what they want and how your business can satisfy these wants? How are you planning to provide your products and services to them? Do you have enough resources to make every customer in the world happy?
Instead of attempting to serve every customer, it’s better to focus on a specific target market, spend time getting to know them and provide their needs – and the information you can gain from membership programs can help you achieve all of these tasks faster.
Through a free membership database, you can ask important information from your customers before they can sign up for your membership program. Usually, you’ll have to ask for your customers’ full name, address, age, and birthdate. Depending on the products or services your business offers, you can ask for more or less information. Regardless, any information you gain from your existing customers can become a goldmine to help your business progress and improve in the long run.
For example, if you found out that most of your existing customers are women, you can come up with marketing ads that are specifically designed to attract the men’s populace. This information can help you streamline your efforts so you won’t be redundant and ensure that these resources are only spent in areas that actually need improvement. This information will tell you that your business already gained the approval of women, and now it’s time to work on gaining the response of the opposite sex.
If your existing customers are generally composed of young adults, you can easily determine what products and services will best fit their needs because you already know who you are dealing with. Knowing how your customer behaves will also make it very easy for you to formulate marketing and pricing strategies that are appealing to them.
2. You’ll Retain Existing Customers.
In order for a business to earn profits, they have to attract customers to pay for their products and services. This is one of the most obvious reasons why businesses will hire the services of marketing experts and commission intricate marketing ads. Businesses will allocate money for their marketing strategies to educate the public that they exist and to convince the public to do business with them. However, if you want your business to survive in the long run, you shouldn’t only settle once a customer makes a one-time purchase from you; as a business, you should implement strategies that can help your business retain customers.
Customer retention is vital to your success as an entrepreneur because this can help you save money on marketing, earn more profit, gain valuable feedback, and enjoy free word-of-mouth advertising. You can always gain new customers, but going through this process over and over again can demand more time, effort, and money from your business. These resources are usually limited when you’re still a startup.
One of the most effective customer retention programs you can have in your business is to implement a membership program for your customers. Once managed and implemented properly, a membership program can become your ticket to keep customers and excite them to continue patronizing your offerings. This is especially true if your membership program includes products and services that are new in the market.
A membership program is meant to reward loyal customers and show how your organization is grateful for customers who continue to patronize your business long-term. A membership program is simply your own way of thanking your customers for helping your business grow while keeping them hooked to continue to do the same in the future.
3. You’ll Build Personal Relationships With Your Customers.
Running your business is not a walk in the park. Before you can achieve business success and experience its financial rewards, you need to make sure that you’re better than your competitors, and you’ve fully understood how the market works. These elements often change, which means that you have to exert time and effort to keep up with the times. Being outdated can become the reason why you’ll lose profits and customers.
You can easily accomplish these tasks (and more) when you choose to implement a membership program for your customers. As mentioned, membership programs can be an effective platform for you to engage with your customers and create an emotional connection with them. Aside from the two points mentioned above, letting your customers sign up for a membership program and giving them additional perks on top of their purchases will make them feel valued. This gesture alone can speak volumes on how your business appreciates loyal customers and how you strive to continue with your efforts so these customers will stay loyal to your business.
4. You’ll Create Brand Advocates.
Marketing is essential in achieving business success. All of your efforts to offer unique products and services will be useless if you don’t have an effective marketing campaign. Who will possibly patronize all of your offerings if no one knows that your business even exists? How will you stand out from the shadows of your competitors if you don’t work on your marketing? How will your target audience choose you if you disregard the importance of marketing? And while there are several marketing platforms and strategies available today, most of these are expensive and ineffective.
As a startup business, you should be careful of the investments you’ll make because one rash decision can become the reason why you will create a negative brand in the market. This can shoo away potential and existing customers. If you don’t want to take chances with your marketing efforts, opt to implement a membership program for your business instead.
Being able to turn your loyal customers into brand advocates is another reason why you should use a membership program for your business. If your existing customers are satisfied with the additional perks they experienced from your business, more often than not, they will tell their own social circle about it. They will talk to their friends, family, and colleagues at work on how satisfied they were on the products and services offered by your business.
For example, if they were able to purchase items at a 50% discount because of a membership card, they will rave to their friends and family on how much money they saved from the purchase. Every customer loves a bargain, and being able to shop more will always be great news to share with other people. Your customers might not know it but by their gesture of sharing positive reviews and feedback about your business, you already turned them into brand advocates. This will allow your business to reach a wider audience without spending more money on marketing.
5. You’ll Attract New Customers.
Although retaining customers is important to every business, this doesn’t mean that you should disregard the need to venture out to new markets and attract new customers. On the contrary, you should work on attracting new customers because this will serve as your touch point to know your customers and eventually create a professional relationship with them. It’ll be very challenging for your business to retain customers if you don’t have any customers in the first place.
For you to continually attract new customers while keeping existing ones, implement a strong and effective membership program in your business. As mentioned, when your existing customers are happy with the products and services they experienced from your business, they will share their positive feedback with their own social circle. This can include people from their neighborhood, place of work, their child’s school, or even in their social media profiles.
The act of sharing this good news with other people can now be considered as word-of-mouth advertising; one of the most effective marketing strategies in the business arena. Unlike the marketing ads you commission on TV and billboards, word-of-mouth advertising is deemed to be more effective because trust is already involved.
To drive the point home, put yourself on the shoes of a customer. If you know someone who actually vouched for the efficacy of a particular business, you will likely follow their recommendation to buy from this business if you trust that person. If your best friend or colleague from work invited you to try out a new product because they were happy with the results, you will likely give in to their offer. You’ll do this because you have full confidence knowing that this individual was not paid by the business to market their products and services. This is how your business will attract new customers after you’ve successfully implemented a membership program in your business.
6. Your Customers Will Stop Comparing Your Price To Your Competitors.
Most industries are saturated with several business players today. Regardless if you’re going to operate as a product or service-oriented business, expect that you will have to compete with other businesses that have earned a large market share.
Implementing a membership program allows you to stand out from your competitors because this program will encourage your customers to stop comparing your price to your competitors and immediately buy from your business. This works because offering something “more” to your customers will make it very easy for your business to foster a professional and emotional relationship with them. Customers can pay for the same products and services from different businesses, but the value you’ll offer them through your membership program can be their most important deciding factor.
If your business sells women apparel, for example, offering a 30% discount to the customers who signed up for your membership program will entice people to continue patronizing your product and disregard any offers made by your competitors. Sure, other businesses might sell the same sets of apparel at the same price, but because you’re offering something “more” on top of their purchases, your customers will choose to do business with you.
7. Effectivity Is Key.
Now that you know how vital a membership program is, it’s time to roll up your sleeves and make one for your own business. With the number of businesses operating in different parts of the world, you’ll have unlimited sources that can help you create your membership program.
Although benchmarking is an important skill as an entrepreneur, remember that your own membership program should also offer unique rewards and not just “free stuff.” It should also provide rewards with intrinsic value and functions as a platform for you to cultivate customer loyalty. Considering all of these things will make it very easy for you to create an effective membership program for your business!