How to use your loyalty program for savvy market research
Most small business owners appreciate the value of a loyalty program. However, the word “loyalty” often blinds them to other benefits they can enjoy from these strategies.
They think that if they can squeeze a few extra sales each year out of a punch card or some similar gimmick, that they’re doing okay.
Frankly, they’ve only started to scratch the surface of what a good loyalty program can do for a small business.
Consider the issue of market research. It’s no secret that small business owners don’t have the funds to do the kind of market research that large corporations are able to afford. However, if you step up your loyalty program, you can use it to mine some very valuable market research. With this information in hand you can then make some very smart plans for the future of your business.
However, you need to go beyond the paper punch card and get your program into a database. Central to gathering actionable market research is to collect the demographics of your customers. If your small business loyalty program is card based or smartphone based, you can have your participants register online.
During the online registration process you can collect the important demographics that will allow you to really understand the buying habits and preferences of your customers. With that information in your database you can begin to target future sales, adapt merchandising priorities and maybe even come up with new business ideas.
For example, if you saw that your younger customers overwhelmingly buy a certain subset of what you offer and there’s an area of your community that matches that demographic, you might consider opening a business in that location that specializes in those items.
The flip side of that coin is to discover the things you sell that certain demographics seldom or never buy. With this knowledge, you can better segment email sale flyers for example by omitting items that won’t be of interest to certain groups.
The possibilities are endless, but if your loyalty program is still living in the punch card era, you’ll never enjoy its full potential. Be sure you’re getting all the value you can from your small business loyalty program.