5 Commercial Benefits of a Loyalty & Reward Platform
A loyalty and rewards platform is a strategic tool that can be used by businesses to enhance their customer retention, engagement, and satisfaction. This is done by offering incentives such as discounts, exclusive offers, and points redeemable for rewards. If done right and targeted correctly they can work extremely well, and help these businesses create a multitude of commercial benefits.
Here we will talk about how a loyalty and rewards platform is used specifically for sports and fitness organisations, ideal for those who work within sports and fitness companies and are responsible for membership acquisition, engagement and retention. Here are 5 key commercial benefits of a loyalty and rewards platform explained in greater depth.
1. Acquisition
Loyalty and rewards platforms offer a range of tools designed to attract new customers. By providing appealing rewards, discounts, and exclusive offers they can entice potential customers to try their brand for the first time.
By collecting data on customer preferences and behaviour, they are able to create more personalised marketing for your business, tailored to your member’s needs. These make the offers more attractive to potential customers, and also allows them to help businesses create targeted promotion aimed at specific customer segments, improving the chances of attracting the right audience.
e.g. Gyms, for example, could use rewards to drive member acquisition effectively by offering a “Welcome bonus”. New members could receive points upon signing up that can be immediately redeemed for rewards. This approach can significantly boost acquisition efforts throughout the year without resorting to discounts.
For example, promoting an offer like, "Sign up now and earn 1,000 ‘gym’ points – only 24 hours left!" can create urgency and attract new members. Additionally, this tactic can be employed to reactivate former customers. This example demonstrates the potential impact that a well-designed rewards program can have on customer acquisition.
2. Engagement
With a number of strategies and key features, these platform are designed to keep customers actively involved and connected with your brand. By offering unique rewards and special offers only accessible through engagement, which encourages users to stay active on the platform.
Gamification is becoming increasingly more important for rewards programs. By incorporating elements like points, badges, and leaderboards, customers are more motivated to participate regularly to earn rewards. They also use customer data to tailor rewards, content, and offers to individual preferences. This personalisation makes interactions more relevant and meaningful, encouraging customers to continue their engagement. By regularly updating and adding fresh content such as new challenges or rewards, this keeps customers coming back to see what's new, thus keeping engagement levels high.
For example, a cycling studio will have a very specific audience, individuals who enjoy cycling and seek an engaging and effective cardio workout, as well as those who value the social and motivational aspects of group fitness classes. Such a studio could greatly benefit from a cycling-based rewards program. Members could earn points for each class or ride attended, or for reaching certain milestones. For instance, the studio could offer rewards like, "You've completed 100 miles – you've earned an extra 100 points!" or "Attend 10 classes this month and receive 200 bonus points."
By gamifying the service and offering enticing rewards that resonate with their passion for cycling, the studio can provide a truly engaging and motivating experience for its members. These cycling studios can keep the rewards programs fresh and exciting by regularly updating the available rewards and introducing different challenges, such as “Tour de (company name)”, where members earn extra points for attending classes that simulate different stages of the Tour de France. This keeps the program dynamic and encourages ongoing participation.
These strategies not only keeps customers engaged, but also fosters a loyal and active customer base.
3. Retention
Retention is one of the main problems fitness organisations face. Loyalty and rewards platforms are designed to aid customer retention through several key strategies that keep customers loyal and engaged with the business over the long term.
By offering constant rewards for repeat purchases and interactions, for example, subscriptions and memberships, this encourages the customers to stay loyal. Exclusive perks and benefits such as special discounts and early access to new products, works alongside this as they make the customers feel more appreciated.
Community building is also a key element to customer retention. By fostering a sense of community through social sharing features and interactions, this helps to create a loyal customer base that feels connected to the brand as well as other customers.
Football clubs for example, could reward fans for showing their support, whether this is by attending a match, buying this years’ football shirt or getting a ‘pie n’ pint’. The incentive to attend matches in person, rather than watching on TV, is greater, increases when fans know they'll earn rewards or maintain their 'attendance streak.' This approach can keep fans engaged and loyal, even if the team doesn't win often. A clever strategy to ensure even the most ‘fickle fans’ keep coming back for more.
4. Upsell
By utilising customer data, these platforms can suggest complementary or high-tier products that match the customers preferences and purchase history. These recommendations are more likely to appeal to the customer and encourage additional purchases.
Cross-selling opportunities also helps loyalty and rewards platforms to upsell products. By highlighting related products during the checkout process or within the customer’s account, the platform can encourage customers to add additional items to their purchase, increasing the overall transaction value.
An outdoor hiking app could significantly benefit from a rewards program in the context of upselling, with the option of a free membership as well as a premium one. The free option, after signing up, would provide customers with personalized product recommendations based on the analysis of their purchase history and preferences. For instance, the company may recommend premium hiking footwear or a new range of strong, lightweight .
However, the premium membership would give member exclusive deals and would act as an incentive for them to click through and upgrade their membership to unlock the rewards. For example, free members could be presented with the following promotion “Upgrade to premium today and receive 10% off Mountain Warehouse, and other exclusive offers.” This would encourage those who are already members to upgrade with the promise of discounts and offers on products they are interested in.
5. Advertising revenue
Through the use of significant client data, loyalty and rewards platforms enables companies to develop highly focused advertising campaigns. By delivering customised messaging to particular customer categories, advertisers can enhance the efficacy and worth of their advertisements.
Ad placement in high traffic areas with high user engagement such as during reward redemption processes, within challenges, or on personalized dashboard pages, ensuring maximum visibility. Companies want to retain their members while advertisers want a more targeted audience to market to.
By combining the two with a rewards program members will continue their memberships with the promise of discounts and rewards, while advertisers will get the sales they’re looking for.
For example, British Cycling have almost 200k members with many spending vast amounts on cycling equipment, while companies like Garmin want to target these customers with their products. By bringing the two together Garmin can offer British Cycling members 40% off and be made a feature brand getting a prime spot at the top of their rewards page. This will help to drive more click and sales, while British Cycling will also get a commission.
Concluding
To sum up, loyalty and rewards program is a tactical element that through providing incentives like special offers, discounts, and points that can be redeemed for prizes, may greatly improve customer satisfaction, engagement, and retention. These platforms can offer a wide range of business advantages, increasing income and cultivating client loyalty, when they are properly deployed and targeted.
For sports and fitness organizations, they are particularly valuable for roles responsible for retention, engagement, and commercial success. By leveraging these benefits, sports and fitness organizations can enhance their customer relationships, boost revenue, and achieve greater commercial success.