Jun 10

Celebrating Your Customers: Cash Programs

Show your customers how much you value them by giving back with a cash program, integrated seamlessly in a POS system from True POS.

Customers are always looking to get the most value for their money – whether it’s choosing the best option in a specific price range or getting more than what they initially paid for. Celebrate your customers and thank them for their patronage with a cash program.

In this blog, learn about what a cash program is, how it can benefit your business, how to implement a cash program, and some thought-starters on the various kinds of cash programs. 

Fostering Loyalty with Cash Programs

A cash program, or a loyalty program, is a marketing initiative that entails rewarding customers for continuing to engage with, purchase from, or avail of the services of your company. Customers can be rewarded in different ways, depending on the mechanics of your program. Customers may receive special discounts, receive freebies, and exclusive benefits, or accumulate points that are “convertible to cash” to be spent with your brand. 

The goal of a loyalty program is to keep the brand’s existing customer base by recognizing the value of their patronage, and understanding and delivering on their wants and needs. If done right, this strategy can help foster customer loyalty, encourage cross-buying of products, and maintain (if not increase) sales. 

A loyalty program is different from an incentive program. A loyalty program is an ongoing initiative that rewards customers at every transaction or visit. For example, customers can earn one point for every dollar spent which they can accumulate and convert to cash to get a discount on a future purchase. Meanwhile, an incentive program rewards customers after a certain target has been met. As an example, for every purchase of a specific product, customers will automatically earn a coupon to join a certain promo. So, the more they buy the product, the higher their chances of winning.

A loyal customer paying for their coffee

Types of Customer Loyalty Programs

There’s no one-size-fits-all model for a successful cash program. Take inspiration from this short list of common types of loyalty programs:

  • Points Loyalty Program

This is one of the most common formats because the mechanics are simple and easy to understand. Customers earn points per transaction, which they accumulate to avail of rewards or benefits later or use to get a discount on future purchases. These points are typically logged and tracked per consumer using a card, app, or customer account.  

  • Punch Card Program

This format is commonly seen in cafes and coffee shops, and personal care establishments like salons and massage parlors. Customers are normally rewarded with a freebie or benefit after a certain number of visits or transactions. For example, a café patron may be entitled to a free dessert after five separate visits or transactions. 

  • Tiered Program

This loyalty program model is a gamified version of the points program format. Customers unlock higher membership levels with better benefits or freebies by earning a certain number of points or achievements per tier. This method can be used to instill a sense of exclusivity in the customer experience. For example, gold-level members who have earned a lot of points may have access to premium benefits, such as dedicated customer support or first dibs on new products.

  • Fee-Based Program

This type of loyalty program involves customers paying upfront or monthly fees to instantly access exclusive rewards or services. Streaming services are a good example of this. Customers pay a fee to watch movies and series that are only available or licensed to that specific streaming service without ad interruptions.

For examples of successful loyalty programs, check out our blog “6 Great Examples of Customer Loyalty Programs.”

Benefits of Running a Loyalty Program

If planned and implemented correctly, a loyalty program can help take your business to the next level. The advantages of a loyalty program include:

  • It Encourages Repeat Patronage

Even if you offer a product or service similar to a competitor’s, customers are likely to choose you if they feel they will get more value for their money, and they are likely to return to keep maximizing this value. According to a 2017 Nielsen survey, six in 10 consumers are likely to come back to a business with a loyalty program. 

  • It Incentivizes Higher Spending

Customers are likely to spend more in an establishment that rewards them for their patronage. For example, a customer might frequent a specific café instead of going to different ones, so that they can earn more points or unlock rewards faster. 

  • A Loyalty Program Can Improve Brand Affinity and Satisfaction

Customers feel happier when they believe they are getting more bang for their buck, which leads them to have a positive perception of your brand. 

  • It Helps You Understand Your Customers Better

Many loyalty programs require customers to set up an account where their personal information is stored, and their purchase history is logged to track points or membership details. Leveraging this information will enable you to understand your customers’ preferences so that you can serve them better. 

  • You’ll Foster a Positive Relationship with Customers

By providing customers with better value and understanding their needs to deliver great service, you can cultivate a positive and lasting relationship with your customers.

Loyal customers smiling happily with the cashier

Developing a Cash Program

If you want to start your own loyalty program, here are a few tips to get you started on the right track:

  • Consider Your Objectives

Aside from wanting to increase your revenue and maintain your customer base, flesh out what you want to achieve in the long run. Do you want to build a community? Do you need to engage customers to provide more feedback or encourage trial of new products? Setting specific goals will guide your planning process as whatever you decide to implement must tie back to that objective. 

  • Know Your Consumer Base

Identify your consumer demographics – their age, technological behaviors, purchasing preferences, and more – as these will dictate some of your logistics. For example, older adults may prefer carrying physical membership cards while tech-savvy Gen Z may prefer to use an app or scan a QR code. 

  • Plan the Details

Once you have your foundational information, you can select the appropriate loyalty program model that will best suit your objectives and target market.  

Rolling out a cash program or loyalty program doesn’t have to be complicated. With a multi-functional and scalable POS system, you can run a loyalty program and consolidate relevant consumer information in one hub. For all your point of sale system needs, contact True POS for a free quote today!

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