Boost Your Business with a Customer Loyalty Program

By Melanie Ivanova

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Depending on what industry you are in, acquiring a new customer can cost 5 to 25 times more than retaining an existing one (Source: Harvard Business Review). Many service area businesses overlook a crucial opportunity: customer loyalty programs. Without these programs, you risk falling into a cycle of chasing new clients instead of nurturing long-term relationships.

Whether you’re a roofer, painter, or plumber—building lasting relationships with clients can feel like an uphill battle. Once the job is done, many businesses move on, forgetting the power of repeat business.

Customer loyalty isn’t just about providing good service; it’s about creating an experience that keeps clients coming back. This requires a strategic approach, something many contractors overlook.

Why Not To Overlook Loyalty Programs:

• High Competition: With numerous service providers in your area, clients have endless options. If you don’t stand out, they’ll likely turn to the next contractor.
• Low Engagement: Without a loyalty program, clients may feel like just another number. Personalized communication can make a huge difference.
• Lost Revenue: According to a study by Bain & Company, a 5% increase in customer retention can boost profits by 25% to 95%.

Without a loyalty program in place, that business lost not just one job, but the potential for referrals and future work from that homeowner. Creating a customer loyalty program is simpler than you might think, and the benefits are enormous.

How to get started:

• Define Your Goals: Determine what you want to achieve with your program. Is it repeat business, referrals, or upselling services?

• Choose a Structure: Consider different types of loyalty programs:

  • Points-Based: Customers earn points for every service, which can be redeemed for discounts.
  • Tiered Rewards: Offer different levels of rewards based on customer spending.
  • Referral Bonuses: Incentivize clients to refer friends by giving both parties a discount.

• Engage with Your Customers: Send personalized communications—emails, texts, or even handwritten notes. This can include updates on their service, maintenance tips, or reminders when it’s time for a check-up.

• Solicit Feedback: Ask your clients what they value in a loyalty program. Use surveys or direct conversations to tailor your offerings.

• Promote Your Program: Use social media, your website, and even during service calls to inform customers about your loyalty program. Visibility is key.

Creating a customer loyalty program can transform your business from merely surviving to thriving.