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SMB Marketing Tips: Rewards that Work

Posted by Joanna Braunold on May 8, 2014 5:09:22 AM

Hopefully by now, you've had a chance to set up your Status cards! We love what we're seeing with different LoyalBlocks clubs and how businesses are utilizing their new status cards to give better rewards and encourage customers to spend smart. If you're not sure how to set up your status rewards yet - here are some ideas to get you thinking!

status card

Buy two, get one free

This is a standard deal, offered on products across the world. But how do you make it work for your business? Let's say that you have a low cost item, with high revenue - for example, cupcakes. Each one costs you $0.33 to make, and you sell each one for $2.50. You know that people usually buy two at a time. So on the average sale, you make $4.44 profit. What if you offered Silver Status level members a deal via LoyalBlocks - buy three, get the fourth free? You're encouraging your customers to spend an extra $2.50, in return for which they get two more cupcakes. That way, you make $6.18 per sale - that's just under $2 extra per sale - and your customer gets a free cupcake. Everyone's happy.

Discount at a certain time of day

LoyalBlocks gives you an opportunity to take your more quiet hours and get busy with them. Let's take a different example this time - a haircut. A haircut in your salon costs $85. You make about $30 on each haircut. But there are times of the day when you have no customers - people are busy at work, and they don't come by. So you end up paying your staff out of hand to just hang out. With LoyalBlocks, you could offer your customers a 10% discount during your slow hours. The price of the haircut would drop to $72.50, and your profit would drop to $22.50. The bigger the discount, the more incentive customers have to come in when it's less convenient for them. It's just a question of balancing the discount with the revenue, and suddenly your quiet hours could become your busy ones!

Fast Track

Not all your rewards have to give something away. Customer service and positive feedback can net you bigger profits in the long run than a one-time deal. Instead of giving Gold Status members a discount, what if they could skip the line? They'd be in and out your restaurant in half the time - which would probably encourage them to come back more often instead of waiting in a line somewhere else for similar food (especially if we're talking lunchtime, when people are generally in a rush to pick something up and get back to work). So now, your Gold members are coming back three times a week instead of once, because they know that they can get better service and spend less time in the line - that's three times the money per customer. When your other customers see someone skipping the line, they're sure to ask why - which will in turn encourage them to join your club, and keep coming back!

Discounts, time-based deals, and better service are just three examples of ways that you can set up your Status cards to benefit both your customers and your business. From high-fives to free date nights, we're seeing some innovative ideas and fun customer interactions come out of our Status card feature. What are you using your Status card for, and how is it helping your business?

Topics: Small Business Tips

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