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A retail business venture needs to attract new customers while retaining existing ones in order to grow and generate high returns on investment. The virtual world is no different from the real in this aspect and every online store is employing strategies aimed at keeping its customer base intact. We will be discussing benefits of loyalty programs that are being used by almost every virtual outlet for the purpose of protecting its user base.
1. Helps In Retaining Customers
One of the biggest advantages of running a loyalty program is that it helps in retaining the customers with the store by giving them an incentive for using its services again and again. Merchants give out extra discounts apart from loyalty points which can be redeemed in return for a product or price cut at a later date. In a scenario where most of the items on the buying list of a person are available at every outlet, the client will naturally chose the one giving some extra benefit and these membership programs are a huge asset in attracting such users.
2. Creates Advocates For The Brand
Any scheme that rewards buyers for their repeated use of the platform will help in identifying the best customers who are using the store primarily because they are satisfied with the service with the added benefits being the secondary reason. These users are also the best advocates for a brand as they will share their pleasant shopping experiences with other people and influence them in using the store. A user may be attracted with an offer like Jabong coupon code for today but if his/her later visits are incentivised then he/she will generate word of mouth publicity which will bring in quality visitors who are expected to remain with the store for a long time.
3. Increases Customer Lifetime Value
The customer lifetime value or CLV is the profit a business makes from a single customer in the period that he/she spends shopping at the enterprise. One of the biggest benefits of loyalty programs is that they help in increasing the CLV of a client by encouraging him/her to spend more and more time with the venture. The statistic is used by marketers to assess whether different promotional strategies are bearing fruit or not. Providing online shopping coupon code to repeat visitors is therefore an essential tactic that will keep them engaged with the store and help in increasing the CLV of more clients.
4. Provides Insulation From Competition
These plans also gives businesses an opportunity to insulate them from their rivals as they are not competing with them on price anymore and instead lest them focus on providing an enhanced customer experience. Once they identify their best clients and their shopping preferences, merchants can offer them highly customized services keeping their convenience in mind. The aim is to take the price factor out of the equation with the user being attached to a platform as he/she feels that the outlet values him/her as a prized customer. Shoppers can be engaged more and with different types of personalized offers it will be harder for competitors to influence them in leaving the outlet in favour of their stores.
5. Promotional Costs Are Reduced
An enterprise gets valuable data on customer’s behaviour patterns apart from the identification of a dedicated user group which is helpful in creating specific campaigns aimed at increasing its involvement with the outlet. The data can also be assessed for formulating a strategy for attracting prospective clients who can be converted into repeat users. Once the most productive mediums and methods of advertising are identified, the promotional costs will automatically get reduced.
The purpose behind listing these benefits of loyalty programs was to illustrate their usefulness for any virtual outlet that get a great platform for increased user engagement and maximizing the profits earned from every single customer.
Alok Singh is a Sr. Affiliate Marketer at CashBenzo, a company that offers online shopping coupon code. He is a passionate blogger and loves to share deal and discounts tutorials for Online shopping.
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