At a car wash or coffee shop you’ve probably been offered a loyalty card. Since it’s one of the lowest-cost ways to lure customers back, consider offering them to yours - in the way that maximizes profits.
Here’s how. Now we’re talking about the kind of loyalty card that's inexpensive to make so independent business owners can offer them. Not the laminated corporate cards. You can print elegantly-designed cards that get stamped or hole-punched each time a customer buys from you.
Why is this method appearing in the Say it Better blog? Because how you “say it” in your card offer influences how motivated they are to return and use it.
Key insight on human behavior:
We are more likely to want to fill up our card to get something for free - if we believe we have already made progress towards our reward.
In a study, loyalty cards were handed out to three hundred customers of a car wash. Customers were informed that every time they bought a car wash, their loyalty card would be stamped. Cards were offered in two way. One motivated more customers to return.
• One type of card stated that eight stamps were required to receive a free car wash, and no stamps were attached to the card.
• The other kind of card stated that ten stamps were required to receive the free wash, but two stamps were already affixed to the card.
• Both cards required eight purchases to receive the award, but the second group seemed well on its way to completing the card with 20% of the stamps needed for the free wash.
Conclusion: It's more profitable to give people a ten stamp card with two stamps already marked off, instead of an eight stamp card with nothing marked off.
Hint: How can you encourage customers to want to buy again or buy more or refer others because they are already "well on their way" towards that future, free reward?