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Holiday Marketing: 5 Reasons Why Customer Loyalty Programs Are Essential
Integrating a loyalty program into your marketing campaign generates year-round benefits.
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Around the holiday season, the top global brands strive to use marketing to evoke emotions, promote sharing and create unforgettable moments. They look for ways to differentiate themselves from their competitors, using various marketing tactics and ensuring the best holiday buying experiences to get into the minds and hearts of consumers.
While there’s no specific formula for success, brands have discovered that there are practical methods for achieving the best results through holiday loyalty program promotions. These strategies can help companies and organizations land new customers and nurture them into devoted brand advocates by maximizing pay-per-click ad spending and developing a sense of urgency to increase the value of goods or services.
Why customer loyalty programs are essential for holiday marketing
Effective loyalty programs increase customer retention, boost sales and improve buyer satisfaction. Enterprise leaders can use big data technology to personalize loyalty offers and increase the likelihood that customers will return to use their points.
Modern technology has shifted the loyalty program paradigm. In the past, physical cards and manual tracking were cumbersome. Today, digital integration allows for seamless customer experiences. Implementing a digital holiday loyalty card that integrates with mobile wallets can significantly reduce friction. Furthermore, artificial intelligence (AI) now helps brands analyze buying behaviors to offer hyper-personalized rewards, ensuring that promotional efforts resonate deeply with the target audience.
Here are five reasons why building brand loyalty during the holidays is smart and essential.
1. A loyalty program is a cost-effective way to build business
Some entrepreneurs may think loyalty programs consume cash and resources without guaranteeing success. However, customer retention is significantly less expensive than acquisition. According to data from Marigold, 70 percent of consumers cite loyalty programs as important to maintaining loyalty. In addition, 72 percent of consumers say they are willing to spend more with a brand they are loyal to. Promoting brand loyalty programs among an existing customer base is more likely to provide a marked return on investment.
2. Loyalty programs yield actionable data
Demographic data is one of the most important resources available to marketers. Detailed customer data helps marketers develop strategic plans that promote sales.
In today’s fickle buying environment, marketers must understand what promotes sales as well as what deters conversions. As third-party cookies are phased out, loyalty programs become a critical source of “zero-party data”—data that a customer intentionally and proactively shares with a brand. This direct insight allows data-science marketers to understand distinct consumer buying patterns without relying on external tracking.
3. Consumers love loyalty programs
Brands that offer loyalty rewards stand out from competitors that don’t offer similar programs. Loyalty programs send a message to consumers that a brand is interested in more than profit. This kind of reward helps brands build a mutually beneficial rapport with customers.
4. Loyalty programs boost brand recognition
Loyalty programs encourage new customers to make repeat purchases faster than they would without an incentive. Additionally, these programs make existing customers feel valued, thereby improving brand sentiment and increasing the likelihood that buyers will recommend goods or services to friends, family members and associates. According to the Wharton School of the University of Pennsylvania, customers referred by other customers comprise a crucial segment, as they tend to have a higher lifetime value. The more customers feel appreciated, the more likely they are to provide referrals.
5. Loyalty programs have successful track records
While the results of loyalty programs vary, they’re time-tested, proven strategies. Business leaders have successfully deployed loyalty programs across a number of industries. Modern businesses focus on Customer Lifetime Value (CLV), viewing loyalty not just as a transactional tool but as an engagement engine. Brands that master this consistency during Q4 often see those habits extend well into the new year.
Loyalty programs enable brands to create a sense of belonging and to build strong emotional relationships with customers, as well as give business leaders the opportunity to deliver experiences that improve with each engagement. By putting the spotlight on consumers, loyalty programs make it more appealing to support brands and share recommendations, utilizing a variety of perks such as early access to holiday sales or exclusive “holiday loyalty card” bonuses.
During the holidays, consumers are exposed to a multitude of emails, social media ads, television advertisements and other marketing channels. Savvy entrepreneurs can leverage loyalty programs to stand out among the competition during the holiday season.
The best business software for loyalty programs
Developing a loyalty program requires vast data management, but these top CRM solutions and highly rated POS systems can help:
CRM software
- Salesforce CRM: This customer relationship management (CRM) software is the best option for businesses that are looking to expand. The software has multiple features that are continually improved based on the needs of evolving businesses, including comprehensive reports for CRM metrics and a set of Sales Cloud integrations. Salesforce Starter Suite begins at $25 per user per month (billed annually), with a 30-day free trial available. Learn more in our Salesforce CRM review.
- Zoho CRM: Zoho’s software offers an easy-to-use solution for those looking to improve their customer loyalty programs. Free for up to three users with paid plans starting at $14 per user per month (billed annually), Zoho’s CRM software is affordable and comes with a closely mirrored mobile app that offers conversational AI and enhanced reporting capabilities — including remote access to analytics, visual dashboards and sales insights — to accelerate sales. Learn more in our Zoho CRM review.
- Keap: While Keap’s CRM software is more costly, with Pro plans starting at $249 per month, it can be used right out of the box without any setup. It offers various automation templates and advanced workflows that use drag-and-drop builders to fit your business’s needs. With Keap, businesses can set up trigger workflows that automatically reach out to customers with automated reminders and notifications, as well as customized and updated deals based on certain conditions, such as a customer’s birthday or a holiday. Learn more in our Keap CRM review.
POS systems
- Lightspeed: Starting at $89 per month for the Basic plan, Lightspeed’s point-of-sale (POS) software is suited for a variety of industries, including restaurants, retail stores and golf businesses. As one of the best POS systems for retail, Lightspeed boasts a built-in CRM that’s perfect for businesses that are looking to develop their customer loyalty program by allowing businesses to track customers’ purchase histories, create and edit customer profiles, and develop rewards programs and custom promotions to incentivize customers. Learn more in our Lightspeed review.
- TouchBistro: TouchBistro is highly customizable POS software that offers tons of restaurant-focused features. This system, which starts at $69 per month, is optimized for restaurants of all kinds, ranging from full-service restaurants to bars and breweries. Among TouchBistro’s wide array of features is the ability to add customer engagement products – including loyalty programs, online ordering and reservations – to encourage customers to return. Learn more in our TouchBistro review.
- GoDaddy: GoDaddy’s POS system is perfect for e-commerce businesses, as it offers some unique features, including website builder templates. Hardware bundles vary in price, but the software is often integrated into their commerce plans. Along with traditional loyalty offerings – such as coupons, gift cards and online sales tracking – GoDaddy offers abandoned-cart recovery, email marketing and list segmentation to encourage customers to return. Learn more in our GoDaddy POS review.
- Square: As one of the leading companies in the POS industry, Square provides excellent customer loyalty opportunities for retail, restaurants and small businesses. While the standard POS app is free (transaction fees apply), the Square Loyalty add-on starts at $49 per month. Square offers customer loyalty program features, including the ability to create digital punch cards and develop a rewards program, as an add-on to expand a business’s POS system based on its individual needs. Learn more in our Square review.
Ryan Ayers contributed to the reporting and writing in this article.
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