Loyalty Stamps are back.
In the digital age, the humble loyalty stamp has received a much-needed makeover. It seems that customers are digging the convenience of a virtual loyalty stamp card that is with them at all times on their smartphones.
It means that they are never without an opportunity to receive a free reward simply by shopping at the places they love.
We probably don't have to remind you all the ways your business could benefit from running a loyalty stamp campaign – in case you forgot though, here is an article explaining exactly that!
In short, customers who commit to loyalty stamp campaigns save money, and the businesses who run them earn more repeat purchases and discourage customers from moving towards the competition.
Loyalty cards increase Customer Lifetime Value, which drastically improves merchant profitability in the long-run.
The strategic approach of developing meaningful loyalty amongst customers is proving to be the most effective in the 21st-century business landscape. This is made more important in light of recent economic events that have put money-saving at the forefront of your customer's minds.
And an effective loyalty stamp campaign is a dependable method for turning prospects into customers and customers into fans.
Okay, but how do you create an 'effective' loyalty stamp campaign? What does that even mean?
As it turns out, businesses make some mistakes that can actually reduce the positive effects of a stamp programme. By taking time to plan and tweak stamp campaigns, you can optimise loyalty stamps in a way that maximises loyalty outcomes and keeps customers coming for more.
Consider this article your brief guide on the best ways to run an effective loyalty stamp campaign. We'll be going through each stage from design to launch, providing the lesser-known tips and tricks on the way to give your campaign that essential competitive edge.
Stage #1 – Campaign Calibration
As we've mentioned before, there are three key variables you can play with before launching your stamp campaign to ensure its effectiveness as a tool of loyalty creation.
These variables are:
- Purchase that earns a stamp
- Number of purchases required for a reward
- Reward given upon stamp card completion
Devising a loyalty stamp campaign is a game of numbers. At a minimum, you want to ensure that the value you gain from the repeat purchases outweigh the cost of the reward you give upon completion of a stamp card for it to be a profitable endeavour.
At the same time, the reward should be desirable enough to motivate the customer to keep collecting stamps, so the product bought to earn a stamp shouldn't be too expensive, and it shouldn't take too long to complete the card and receive a reward.
Let's take the example of a book store to illustrate what that might look like.
A bookstore sells its books at an average of £13 each.
Their stamp programme allows customers to earn one stamp per book purchase of £13 or more. Six purchases entitle them to their reward – a free book worth no more than £13.
The customer has spent £78 to get a £91 worth of books – 7 books total.
Now imagine the competition with no loyalty stamp programme and sells books for a lower price at £11 each. At the point of their 7th book purchase, the customer has spent £77.
Thanks to the loyalty stamp scheme, the customer at the first bookstore has spent only £1 more and received an additional book worth £13. They beat the competition in terms of value received by customers even when setting a higher unit price.
Before you start your loyalty stamp campaign, experiment with all three of the main variables. Compare the value offered to customers with that of the competition alongside your profit margins for the best possible performance.
Stage #2 – Promoting your loyalty stamp campaign
It's no use running a loyalty stamp campaign if no one knows about it.
One of the biggest mistakes we see with businesses giving loyalty stamps is a lack of focus on advertising the programme to new and, perhaps more importantly, existing customers.
Whether your store exists in brick-and-mortar or online, running digital advertising campaigns to promote your stamp programme is the most cost-effective way of getting the message out there. And thanks to the large data pool customers and prospects provide on digital platforms, targeting the right people has never been easier.
You wouldn't offer a limited-time store-wide discount promotion without advertising it, as you would be wasting the additional demand that it could generate.
The same applies to loyalty stamps. So, don't forget to shout it from the rooftops – loyal customers get rewarded when they shop at your store!
And please don't confuse digital promotions with handing in paper loyalty stamps. Giving our paper stamps might not be the most responsible way to promote your business during a pandemic. And most physical loyalty cards also end up lost or unused, sending the signal to your customer that your promotions don't matter. This is the opposite of what you want to happen.
Stage #3 – Tracking and adjustment
So, you've created the perfect loyalty stamp structure that maximises the value offered to customers as well as the revenue generated by repeat purchases. You've promoted your campaign, and the people who would respond best to it know all about it and are ready to start collecting. Are you done?
Now you have an army of loyal customers collecting rewards, and you have the perfect opportunity to assess the structure of the programme and adjust accordingly.
What does this mean? It means gathering all the data relating to stamp collection – customers collecting as a proportion of total customers, bounce rate, the average number of rewards collected, basically anything that gives you an insight into the scheme's performance.
In our example, the bookstore may discover that many of their customers began to collect stamps but quit at an average of four stamps collected before any reward was given.
In response, they could do the following:
- Reduce the number of stamps needed for a reward to 4 and reduce the value of the reward
- Keep the number of stamps needed for a reward the same but increase the value of the reward
- Reduce the value of the purchase needed to earn a stamp
Any of these actions would boost the persistence of stamp collection amongst customers while maintaining the increased profitability generated by the scheme.
This is the best part about stamp campaigns – they are entirely flexible and can be customisable to fit the desires of your customer. A video game store might know that a free controller is more valuable to the customer than another video game and offers that as a reward instead.
No two loyalty stamp schemes are the same. The customisation level is limited only by your imagination, which brings us to our final extra tip.
Extra Tip – Create a broader loyalty programme around the stamp campaign
A stamp system is only one of a whole host of loyalty-boosting initiatives a store can run to increase their long-term profitability.
You have discount campaigns, cashback campaigns, and tiered loyalty programmes that are all unique to your store's context.
And the best part of running a wider loyalty programme is the value you gain through the data collected.
Imagine you're a customer of the bookstore. As a reward for collecting your 6 stamps you not only get a free book, but the next book in a series of books you've been reading by your favourite author.
That level of personalisation is what turns customers into raving fans who stick with your store for life. And they tell all their friends about how well their bookstore knows them, and why you should be shopping there too.
This might seem like a lot to implement. You may not know the first thing about setting up a loyalty stamp campaign and don't want to spend the money to design one from the ground up.
That's why we've created a platform to do all the hard work for you.
By joining the OMG network, you can easily design, launch, and track not only loyalty stamp campaigns, but wider loyalty programmes in general.
We have made it as easy as possible to get your campaign off the ground and optimise for the best possible performance on the go.
And the best part? It's totally free.
Join our waiting list, and we'll be in touch with the details.