Loyalty programs are everywhere you look. At the airport, gas stations, grocery stores and coffee shops, every retailers seems to be offering some perk to its frequent customers. More and more business are recognizing the value of these programs in retaining existing customers. Why? Because it’s a cost effective and a vital component of maintaining a competitive edge in today’s marketplace.
Data shows that it costs business 5-10 times more to acquire new customers than sell to existing ones. Additionally, existing customers spend an average of 67 percent more than new customers.
Consumers have also come to expect loyalty programs, especially from larger retailers. Good rewards programs are wildly successful; they can be the reason that a customer always flies with Jetblue, or purchases all their cosmetics from Sephora.