Adding a loyalty program to your coffee shop business is like adding another ball to juggle in the air. You don’t know if you’re going to be able to keep all those different balls from dropping.
It’s understandable that adding a new strategy, like a loyalty program, to your business may be daunting. You don’t know how it works, and if you go the modern route with a digital loyalty program, you don’t know whether you should hire a developer or what kind of developer to even look for.
But a properly-constructed rewards program not only keeps existing customers loyal; it can drive even more traffic to your coffee shop. People love getting rewarded for something they wanted to do anyway.
So let’s talk about some common myths surrounding loyalty rewards programs, and why you really should start one as soon as possible…
Common myths about loyalty programs
A lot of misinformation floats around the internet, and it can make coffee shop owners worry more than they need to. The truth is that starting a rewards program for your customers isn’t as big of a hassle as it may sound.
In fact, it’s quite easy once you know what myths to ignore:
Myth #1: I’ll have to put a lot of time into building a loyalty program.
Not true. You can actually use a third-party loyalty software, like Loopy Loyalty. Using third-party software means you don’t need to put any time at all into building a program. And you don’t have to hire a developer or possess any technical knowledge. And there’s most definitely no need to develop an App.
Instead, you can use a pre-built loyalty software platform and customize it with your coffee shop’s branding. Not only do you get your own digital stamp card within minutes, but you also get ongoing support from our awesome team whenever you have questions or issues.
Myth #2: My coffee shop will lose money from giving away rewards.
False. Rewards programs consistently bring in more revenue for coffee shops. That’s why so many of your competitors are implementing them. Even when you pay a small recurring fee for third-party solutions, the increased traffic and customer retention rates will outweigh the number of free coffees or pastries you give away through a loyalty program.
Remember, the lowest cost sale you can make is to an existing customer because you don’t have to spend any money on obtaining their business. And on average, existing customers spend about 67 percent more than new customers. So your loyalty program is definitely an investment that should give you a positive return.
Myth #3: It will be difficult to train my staff.
Definitely not. Rewards programs are designed to be simple for customers and staff to use. A well-designed loyalty software will be user-friendly and intuitive for your staff to use. You should be able to train your team to understand your coffee rewards in one short session.
The real reasons your coffee shop should have a rewards program
Here are the real benefits your business can gain from implementing a loyalty program:
- Customer retention. Although a rewards program can entice new customers, the biggest benefit is from retaining existing customers. They are the ones most likely to sign up for your rewards. And that really does help to keep them loyal and coming back more often. Annex Cloud looked at their customer loyalty statistics and found that implementing a loyalty program increased their overall revenue by 5–10 percent, with loyalty program members buying 5–20 percent more frequently than non-members.
- Improved reporting. Loyalty software stores customer data. That means you can track customer trends and use that data to create better sales strategies for your coffee shop.
- Better market targeting. Once you implement a loyalty rewards program, you’ll be able to use the data you gain to see which customer segments are most profitable. You can then prioritize the market segments that are most profitable for your company and tailor your marketing messages to them specifically.
- Reach your customers more easily. Not only does loyalty software provide a digital stamp for purchases, it also allows you to communicate with your customer base. With Loopy Loyalty, you’ll be able to send push notifications and location-based messages to your rewards members. It’s a more direct way to send promotions and new product announcements to your regulars.
Executing a Stellar Rewards System
One example of a coffee shop utilizing the Loopy Loyalty digital stamp card solution is NOC Coffee & Roastery. When their customers collect 9 stamps on their digital loyalty card, they get their 10th coffee beverage free. Simple. Easy. Convenient.
Need some more inspiration? Have a look at how these 10 Cafes and Coffee Shops from around the world went digital with their loyalty program.
Or get started today by following these four steps to Create a Successful Loyalty Program for Your Coffee Shop.
