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Customer Club (loyalty Program)
Posted By: ada.adalam on 6/26/2005 11:39 PM (CST) 25 Points
hi

We are the machinery Co and would like to set up a customer club. Our customers mainly are the dealers (not endusers). Pls advise how to build up the club.

Thanks.

Posted by: E-Marketing* Accepted Answer
6/27/2005 2:32 AM (CST)
Begin with the end in mind... what is your goal from this club? What information do you need from your customers to realize this end? How do you need to engage the customers, and how often? In return, what will you offer these members for their participation (e.g. discounts)?
 
Posted by: ada.adalam Author Response
6/27/2005 2:56 AM (CST)
our goal for this club is for the customer loyalty. We have prepared some promotional items (like t-shirts, caps..) and we would like to set up the club for their redemption. Basically, we just think of the point program (every dollar purchased = 1 point). Any recommendation? Thanks!
 
Posted by: adammjw Accepted Answer
6/27/2005 3:27 AM (CST)
Hi ada,

You are now thinking in terms of tools instead of the goal.Pls try to first set the goal i.e. what you precisely want to achieve with you loyalty program?
So check what's the retention rate now of your customers? How many of them do you lose on yearly basis? How much money do they spend with you?
If you know that then set your targets like I want to achieve an increase in customer retention of say 15%, then I want my customers to spend with me 25% more than now.
Then you can measure your loyalty program.
Besides it could be helpful if you tried to get insight from your customers to find out what are the obstacles in their buying more from you and what you need to do to make them buy more with and without your loyalty program! Perhaps you can also help them in some other way making it more effective for them.

Regards

Adam
 
Posted by: ada.adalam Author Response
6/27/2005 5:12 AM (CST)
hi Adam

Thanks a lot for your comment. It's helpful....

Of course, we would like the loyalty program can achieve:
customer retention
sales growth
margin growth
new customer growth
increase corporate image

What's tool can we use then?

thanks....
 
Posted by: Zeme Accepted Answer
6/27/2005 5:43 AM (CST)
Hello Ada,

How to build up the club?

1. Set what incentives you will offer your customers to belong to this club.

2. How will you communicate with them. (and how will they communicate with each other?)

3. How will you measure your results.

What tools?

- What are you prepare to give them?

- Do you want to reward your users for their long-term purchases?

- Or do you want to make automatic rewards?

It seems to me you are already in the right track. Why not try this website for more ideas: http://www.incentivecentral.org/Customer_Retention__Keeping_Your_Best_Custo...

 
Posted by: adammjw Member Response
6/27/2005 12:51 PM (CST)
Ada,

First off check the figures, then try to work out the life time value of your average customer.Having found out that you have to decide what portion of the net contribution of your average customer you want to allocate to marketing as a whole.Then you have to decide what percentage you want to devote to customer retention.Quite often it comes to 20% of the overall marketing budget but it depends on you, how much you want to spend on fairs,direct marketing, promotion etc.
That said you know where you stand and then can decide what tools to choose.It could be promotional products as you say, extra discounts( though I'm not very much for it), could be as well weekend trips to some fancy places, etc.The more your speak with your distributors the more you will find out which tools will make them tick.

Regards

Adam
 
Posted by: jusedom2 Member Response
6/27/2005 3:42 PM (CST)
Ada,

Sometimes, actually most of the time, simpler is better. As others have mentioned, make sure you have defined a goal or goals for your program. This goal or goals must be quantifiable. You must be able to measure the results in order to know if your program is truly the reason for your success.

To keep things simple, start out by just tracking the orders placed by your distributors. Know how much they order, how much they spend with you and how often they order. Then begin to use this information to make it easier for your distributors to work with you. In your business, you want to this with every one of your customers, so setting up a loyalty program per se, may not be necessary.

If you want to give your customers something for doing business with you, then set your thresholds internally and make sure your sales people have the customer’s history available every time they talk. If your “giveaways” are based upon the number of orders or number of items purchased, make sure the customer knows that “if you order X more items, we’ll send you a free “something”. Same scenario if you base it on dollars spent. My preference is more of a surprise and delight type situation, where the “gift” along with a thank you message is sent without their knowledge.

If you don’t have the internal systems to keep track of this, a company like salesforce.com should be able to help.

The bottom line is that you’ll be able to keep and grow these customers if you provide a good product at a good price (not necessarily the cheapest) and give great service. Anticipate their needs and contact them. We’ve helped a couple of manufacturing clients do this and add a marketing component to their sales process. We don’t send ads, but instead use the customer’s history to stay in touch.

Best wishes,
 
Posted by: ada.adalam Author Response
6/28/2005 9:37 PM (CST)
hi all

Thanks for your advise, i have got more ideas how to do it. By the way, could anyone give me the steps of how to set up the customer club?

thanks!
 
Posted by: KAU* Accepted Answer
7/1/2005 2:16 AM (CST)
Perhaps this club will give away free t-shirts and other crap at a BBQ with entertainment, and possibly near a lake or some other interesting form of recreation? Golf? 4x4ing. Quading? This is a Machinery group right?

Invite all your best customers to go to this event you hold once a year. It gives a chance to just get to know each other, your families will meet, and the kids will have a darn good weekend too. Fun for the whole family.

One company I know about paid to rent a small slope at a Skill Hill. It rented the tubes to go along with this nice sloped hill. Then it invited all its staff and thier children to go tubing. Super Fun.

Maybe have a big Golf Trip?

Giving away a t-shirt with some point program won't really matter to most customers. They will like the t-shirt and all, but it isn't going to persuade them to stay with you. Get to know them, develop a relationship. This means it is nice to spend time in a non-work related environment. More relaxed and fun.
 
Posted by: carrie77 Moderator Response
7/9/2005 6:50 AM (CST)
Hello all. I am closing this question since ther has been no activity in over a week. We do this to reward the contributions of participants in a timely manner + to give increased visibility to the newer questions.

Thanks for participating!
Carrie (Production Editor)
 


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