Customer loyalty programs can range in size, scope and often budget. From a simple points system where customers can spend their way to discounts and rewards to elaborate loyalty programs with tiered incentives, customers thrive on the gamification of these programs, always looking for the next loyalty program incentive or to hit the next tier. From a company standpoint, loyalty programs are all about maximizing customer retention and lifetime value. As you consider what rewards to include in your program, there are many creative uses for gift cards in loyalty programs. This blog explains how you can use gift cards to build loyalty, extend lifetime value, increase referrals, advocacy and customer engagement.
1. Build Loyalty
When building loyalty with customers it’s common, almost expected for customers to get some kind of reward or incentive to maintain their loyalty to the business. Whether you use a point system or just straight rewards, gift cards can be a great option to build customer loyalty. Gift cards:
- Hold a memorable “trophy” value that simple discounts may not
- Can bring direct monetary value to your loyalty program or be used as a reward redeemed with points
- Provide customers with some ownership of your brand
When considering how to build loyalty within your customer base, gift card rewards for loyal customers can build rapport and maximize the lifetime value of that customer.
2. Extend Lifetime Value
Every business wants to be able to maximize the lifetime value of a client. This means ensuring you have a long and fruitful relationship with every customer and that you are the only retailer/vendor they use within your category. When thinking about how to extend lifetime value, using rewards like gift cards can:
- Show loyalty back to lifetime customers by adjusting the value of the card to how long they’ve used your brand
- Offer flexibility to fit any loyalty program budget
- Provide a variety of ways to redeem the reward by offering a variety of gift cards that will be valuable to your customer audience
The Engage2Reward™ Choice Card provides the versatility any loyalty program needs, providing not only budgetary flexibility to scale the reward to the loyalty level, but also the flexibility for the person redeeming the card to allocate the value to one of over 250 retailers of their choice in the Engage2Reward™ platform. The Engage2Reward™ Choice Card represents the flexibility guaranteed to bring value to the way you reward your loyal customers.
3. Increase Referrals and Advocacy
When incentivizing customer loyalty, one of the best things you can do is reward customers for referrals or giving public testimonials for your brand. Using gift cards for loyalty surrounding advocacy is effective because it:
- Builds brand awareness and category presence
- Provides meaningful rewards for existing customers
- Establishes immediate trust with new customers
Creating repeatable, scalable referral programs can be a way to scale your whole business. Investing a manageable amount into building a referral program as part of your customer loyalty effort is a great first step. Using gift cards as rewards allow you to scale your rewards to your initial budget and build up the rewards investment as the program grows.
4. Customer Engagement
Keeping customers engaged is an organic way to build loyalty. Engagement keeps customers connected to your business and increases their sense of ownership over the brand. One way to keep customers engaged and loyal is to offer gift card incentives for desired behavior. Gift cards provide connection and engagement by:
- Keeping your brand or business top of mind with customers between purchases
- Getting customers engaged in the “game” of loyalty as they work toward their next reward or to hit the next tier of the program
Another component of customer engagement is ensuring you provide rewards that are valuable to your audience. Knowing what other brands they use so you can effectively drive engagement is key. For example, a Sephora gift card for loyalty promotion could be impactful to a segment of your loyal customers, but others may prefer a different brand so the Engage2Reward™ Choice Card would be a great option that allows the recipient to pick the brand they want to redeem for.
Conclusion
Gift cards are a great basis for loyalty program rewards at any level. They are versatile, scalable and can adjust to bring value to any type of customer in any denomination that fits your budget. Driving customer loyalty with gift cards is a great way to start, revamp or continue momentum within any loyalty program.
Learn more about how the Engage2Reward™ Choice Card through the Engage2Reward™ platform can support your loyalty program today!
