Building Loyalty: How to Start a Customer Loyalty Program
Gather around, friends, for we’ve got a fun topic at hand today: customer loyalty.
Return customers are a boon for any business. They already like what you do, so you don’t need to convince them to give you a try. So long as you keep performing excellent work for them, they’ll keep coming back.
Of course, you want to give them every reason to keep coming back, right? You want them to banish all thoughts of other repair shops to the dark netherworld of the Force—
(Editor’s Note: You get ONE Star Wars reference, Suz. ONE!)
—and think only of your shop when it’s time for maintenance or repairs.
There is a real, financial reason why you want to keep your existing customers coming back. It’s more expensive to pull in new customers than to retain current ones—how much more expensive depends on your advertising/marketing budget and other factors but you’re still spending more to get more. Sometimes a lot more.
So, why not incentivize the customers you’ve got? Give them reasons to stick around.
But Fullbay, you might be saying, I already know how to keep the ones I’ve got! I fix their trucks and they are happy.
Yes, running a good operation is a big part of hanging on to customers. But you might also want to look into a good old-fashioned customer loyalty program.
What is a customer loyalty program?
In short, a customer loyalty program essentially rewards customers for coming back to your shop.
Not only are they getting the kind of repairs dreams are made of, they’re also getting some kind of kickback. This could include:
- Free services (like an oil change) after X visits
- A gift card to a local coffee shop or Amazon (or other business of your choice) after spending a certain amount on repairs
- A particular amount off after referring someone to your shop
Creating a program like this—however you do it—tells your customers you value them enough to offer them something. Everyone likes a reduced rate or the occasional freebie. By providing a reward, you’re elevating what was a purely transactional interaction. When they feel valued, customers are more likely to come back—and talk you up to their friends.
(Which, FYI, can translate to new business over time.)
Do I need to get software?
The good news is you can start very, very simple. Yes, there’s customer relationship management (CRM) software out there that helps you track things, but if you’re feeling a little nervous, you can go with the old punch-card route. Every time a customer visits you, they get a hole punched in that card. On the tenth visit, they get a free service—we’ll stick with the oil change here.
The punch card idea is particularly useful if you don’t want to bring software into things. It’s easy for whoever’s manning the front desk to glance at the card and see how close a customer is to that free service. Basically, they track themselves.
If you do decide you want to get a little more complex with your customer loyalty program—like you want to start tracking things—then you can invest in a simple CRM app, such as HubSpot.
How to start a commercial repair shop customer loyalty program
We suggested the oil change idea further up, but here are some other suggestions:
The first thing you need to do is decide what rewards you’re going to offer. You can build up from there.
- Customers that spend over $5,000/month receive a free DOT or BIT inspection. Fullbay can help here—c’mon, you knew this was coming!—as its “All Revenue Report” lets you see how much everyone is spending per month.
- Customers receive points for PM work or repairs. You decide how many points each service is worth; they can then redeem those points for services down the line. For example, if a customer has racked up 15,000 points in a year, and a transmission flush is 20,000 points, they can apply their 15,000 points to that flush and pay a discounted rate.
- Customers receive some kind of financial reward for each visit. This operates similarly to the point system in that you’re tying some kind of financial reward to each expenditure at your shop. Maybe they get $25 toward a service for every $150 spent, for example.
- You can broaden this incentive by offering them rewards outside your shop. We mentioned Amazon or coffee shop gift cards earlier, but think about other things your customers might find useful or enjoyable. This is also a great opportunity to build relationships with other local businesses in your area!
- At this point you may want to look into rewards software—otherwise you may find yourself needing to acquire and hand out various gift cards left and right. Instead, your customers can download a free app to their smartphone; when they spend money at your shop, their rewards are automatically loaded into that app. No paper, no plastic. Woo!
Once you’ve decided what kind of rewards or incentives you want to offer, you can start looking around for the right kind of CRM (or other method, like punch cards or…gulp…spreadsheets) to track them.
Now comes the easy part: getting the word out.
Hear ye, hear ye: Marketing your shop loyalty program
If no one knows about your loyalty program, does it even exist?
We’ll let you ponder the philosophically devastating ramifications of that question for a moment.
(The answer is no, by the way.)
You can roll out your program to existing customers fairly easily. Let them know about it as they come in, and depending on what incentive they choose, get them enrolled or set up as necessary.
But you’ll also want to take to your usual marketing channels to get the word out. Put a notice prominently on your website that encourages potential customers to learn about and enroll in your program. Remind people on your social media that you have a program and let them know about the rewards. If you have a newsletter or some other email list, plop a notification in there.
Onward and upward
We’ll be the first to tell you this isn’t a comprehensive how-to for starting a customer loyalty program. That’s the thing with marketing—there’s always more to experiment with or learn about, and no single tactic ever works on its own, perfectly, alone, forever.
So give your customers reasons to come back! Implement a loyalty program and see how it goes. We’re rooting for you!