Woolworths and Coles have one. Every major airline has one. The credit card companies all offer them. Countless retail chains promote theirs. And between them they have a significant chunk of the population signed up.

Loyalty and rewards programs seem almost mandatory.

They are designed to “ring fence” your customers and keep them buying from you. And they work. Think about how many times you’ve chosen the Coles or Woolworths petrol station over the rival next door just to save a couple of dollars?

But what if you’re a smaller niche player? What could you offer your clients to keep them coming back?

Cafés are prime examples with their coffee club cards. You get it stamped each time and earn free coffees or Barber1cakes.

My barber has a loyalty card where you get 25%, 50% and 100% off haircuts as you go along. They’re smart. They give you little rewards as you go along, then the big one.

Something my old hairdresser could have learnt – that and indifference were the main reason I sacked them (read about it here).

And they now go one further – they come to you!  See the image on the right.

Last week I wrote about All Heads Services’ amazing triple guarantee. What I didn’t mention is the loyalty or “Profit Assistance Program” they offer their mechanic customers.

If you recall, All Heads repairs car cylinder heads. Should your car blow a head gasket, throw a piston rod etc., your local mechanic takes off the old head, and All Heads send them a refurbished one.

Cylinder heads range from $500 to $3,000+ depending on the make plus labour.

To differentiate themselves from the competition and buy loyalty, All Heads came up with the buy 5 get the 6thallheads checks one free.

Put simply, the mechanic buys 5 Petrol, Gas, Diesel or Engines over any length of time and gets the 6th, regardless of the value absolutely free.

So the more the mechanic puts through, the more they earn. So they can keep the saving or pass some or all of it on. And in a competitive world where margins are being squeezed, every little bit helps.

And they don’t stop there.

Consistent cash flow is one of the biggest issues we all face in small business. Unlike most pay on time programs where you might get a small discount, every month a mechanic can win a major cash prize, an extra cylinder head count towards the buy 5 get one free, tasty hampers etc.

And once a year, someone wins a major holiday prize to an exotic location like Bali or Fiji.

Here’s my final example…

The MD of a mid-sized telecom reseller told me how he ring fences his clients and keeps them in the fold.

Clients earn points where they get back “spending money” they can use on any of the provider’s products or services. Some customers get $3,000+ a month additional funny money they can use. Every corporate client also gets taken out to lunch once a month as a relationship building exercise.

But the biggie is an “ego” benefit. Their platinum clients earn points towards taking a large motor cruiser out on the harbour. This way clients get to take their family out or show off to their friends or clients.

The MD recounted how a client’s financial controller went to his CEO showing him that they could get a cheaper deal with another provider. The boss wouldn’t have a bar of it. He was a regular user of the cruiser and there was no way he was going to give this up – even if it meant saving money.

One of the big lessons here is people want to feel good. They want you to value them personally and a reward that makes them look more important, be able to show off, builds their self-esteem can be far more valuable than giving them money!

Rewards programs don’t have to cost you a lot. In the telco’s case, the cruiser is sitting there. It costs whether it’s being used or not. So why not put it to good use to build client loyalty.

And for those of you who don’t have the luxury of a cruiser sitting around, Gold Class movie tickets can be a welcome reward.

What could you do in your business? If you’d like help implementing a loyalty program that works for you, give me a call on (02) 9499-7958.

We’ll sit down, work out what you can spend – which depends on the lifetime value of your client, what your clients would appreciate and then put it into practice.


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