There are many different types of loyalty systems and loyalty offers in retail businesses and in Australian newsagencies. Too often, I see newsagents and small and independent retailers more generally implement a loyalty system and make expensive mistakes.
Here are some tips for successfully implementing a loyalty program based on my experiences in my own retail businesses and experiences working with retailers in other channels including some who have implemented more sophisticated and networked solutions than any in the newsagency channel.
- Reward above-average behaviour and drive a better return for you.
- Use of the basket data. This is your key benefit.
- Control your data and how it is used.
- Use your data to drive your program.
- Leverage the program to serve your needs ahead of all else.
- Be consistent in your offer.
- Keep it simple.
- Use your loyalty program to reinforce your point of difference (USP).
I started the newsagency channel’s longest running loyalty program in 2004. It’s still running today and is a key factor in above average performance in participating stores. It meets the eight points noted above.
The back end of managing a loyalty system is complex. It takes sophisticated software to leverage the real value of collected basket data. This is where major national retail chains do well – their pockets are deep and they have suppliers who will fund the work because of the value of the data.