How to Create Customer Loyalty Programs

While you should always do what you can to acquire new customers, retaining the ones you already have is very profitable. A customer who has previously made a purchase at your bakery has a 60 percent chance of making another purchase. And recruiting new customers costs five times as much as retaining current customers.

A solid customer loyalty program can help drive customers to your store while cultivating a new loyal base of consumers.

Here’s how to create a customer loyalty program.

The Foundation: Answering the Right Questions

As you’re thinking about designing your bakery’s loyalty program, you’ll want to create it with your best customers in mind. Of course, you’ll want everyone to participate, but thinking about the habits of your most frequent or highest-paying customers, can help you guide other customers to act as they do. How much are those customers spending on average? How often do they come into your bakery?

Not only do you need to understand your customers, but you should have a good idea of what’s most valuable to your bakery. Would you rather increase the number of visits each customer makes or the dollar amount spent in one visit?

Once you have a feel for what you’re trying to accomplish, you can move on to creating the program.

Most Popular: The Point System

One of the most popular loyalty programs uses a point system. For example, BakeSmart offers bakeries a customer loyalty program with the option of assigning a point for each dollar spent, or a certain amount of points per visit.

A point system is fairly simple to implement as long as you know at what level of points customers will receive rewards and what those rewards are. Obviously, there is a balance between these. You can’t set your goal too high and offer a reward that doesn’t match the amount of money or effort the customers have spent.

If your bakery decides to use a point system, here are just a couple of extra ways you can customize it:

  • Use a tiered reward system to encourage customers to spend just a little more to get to the next level of points. For example, if a customer spends between $5-10, they receive 10 points, but if they spend between $11-20, they receive 20 points.
  • Offer double points during your normally slow period. This could be a time of day, a day of the week, or even a combination of the two (Tuesdays from 1:00-4:00 pm).
  • Integrate points with your email marketing. If a customer hasn’t come in for a while, entice them by offering points if they come in soon.

Punch card

If you are trying to increase the number of visits, a loyalty card may be your best bet. A loyalty card offers a free item after a certain number of purchases or visits, something similar to a buy 10 and get the next one free.

A loyalty card for your bakery could be for anything that you sell: loaves of bread, cupcakes, cheesecakes. You could even get creative and offer a baker’s dozen. After a customer purchases 12 of an item, they receive the 13th free.

If you have the ability, try to implement a digital card that customers can keep on their smartphone. People tend to lose physical cards, and so they might decide not to participate at all.

Reward a Variety of Actions

Don’t forget that you can reward your customers for anything you want them to do or keep doing. That, of course, means spending money in your bakery, but you could also provide rewards for anything you want a customer to do, like:

  • Sign up for your email newsletter
  • Follow your bakery on social media
  • Refer someone to your bakery which gets new faces into your storefront

Offer Meaningful Rewards

No matter what kind of loyalty program you use, make sure the reward is worth it. Whatever you’re asking a customer to do, they are putting in their time or money, so they don’t want to be let down.

In fact, you may not even get the participation you’re hoping for if you require customers to spend a thousand points for a measly cup of coffee (even if your coffee is really good). We can’t tell you what rewards you should offer, but it’s a good idea to have a variety. At one level it might be a 15% off coupon, but at another, it might be a free dozen doughnuts.

And don’t think that rewards should only be related to your baked goods. You can also allow your loyal customers to reap the rewards on things like discounted merchandise, baking classes, or anything else your bakery has to offer, as long as the reward matches the amount of money or effort spent.

Partner With Others For Compelling Rewards

One way to offer attainable and desirable rewards is to look externally to local businesses that you could potentially partner with. Note that this works best with non-competitive businesses that you most likely share the same customers.

For example, maybe there’s a party supplies store down the street. If a customer spends a certain threshold of money (or earns a certain amount of points in one visit) at your bakery, they receive a discount at the party supplies store or vice versa.  Your bakery and the party store don’t sell the same items, but parties and baked goods often go hand-in-hand, so the same people would potentially be visiting both.

By partnering with others, you can create an offer that benefits your bakery, your partner, and your shared customers.

Market Your Program

After you’ve established your customer loyalty program, make sure people know about it. Treat your new program like a new special or product and create a marketing campaign around it.

  • Send out email announcements before, during, and after the program’s launch to build interest.
  • Set out signs at your locations
  • Create a page on your website
  • Include messages on social media

Your bakery’s customer loyalty program could be as simple as a card and specialized stamp, or you could go high-tech and use an online platform. Whatever makes sense for you and your customers, you can be sure that you’ll turn some infrequent customers into loyal ones.

Already have a great customer loyalty program, but want help with managing your bakery operation? Schedule a demo of BakeSmart today to learn more.

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