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Are you thinking about starting up a loyalty card scheme for your small business? If so, we don’t blame you! Loyalty cards are powerful marketing tools, providing customers with an obvious incentive for returning to your company after they’ve made their first purchase.
On today’s high street, you’ll struggle to find a single café, book shop, dog groomer or other small business which doesn’t have some sort of loyalty scheme in place. By promising a deal, discount or freebie for returning customers, you ensure that members of your target audience will choose your business over a competing establishment when they’re next in need of the product or service that you offer.
Read on to discover exactly how loyalty cards work, and how they can work wonders for a business like yours.

What Are Loyalty Cards and How Do They Work?

Loyalty cards are designed for the all-important purpose of customer retention. All business owners know that, as important as it is to attract new customers, retaining existing customers is even more crucial.
Many marketing studies have shown that the longer someone has been a customer of a particular brand, the more money they’re likely to spend there. They’re also more likely to keep coming back to this particular company again. Loyalty cards give customers a tangible, clear reason to keep shopping with you, rather than trying out a competitor – hence their name.

Most loyalty cards work on the basis of offering a free gift once the customer has made a certain number of purchases. For example, a hairdresser may offer the 10th cut free. With each haircut, the customer receives one stamp on their loyalty card. Once they’ve collected 9 stamps, they can hand the card over for a free snip. Loyalty cards can also be points-based, with points awarded depending on the amount of money spent; this is a common scheme at supermarkets.

Any kind of business can implement a loyalty card scheme, no matter your target audience, and regardless of whether you sell products or services. Small and large companies alike all benefit from customer retention!

What Types of Loyalty Cards Are There?

There are many different variations of loyalty card schemes. They can be divided into three main types: punch/stamp loyalty cards, points-based loyalty cards, and VIP membership cards.

Punch/Stamp Loyalty Cards

The simplest and most straightforward type of loyalty card is the classic punch/stamp loyalty card. These cards are printed on disposable cardstock and are designed to be hole-punched or stamped when the customer makes a purchase.
For example, a coffee shop may offer each customer their 10th coffee free. For each coffee the customer purchases, they get one stamp on their loyalty card (or one hole is punched out of it). When the customer has collected 9 stamps/holes, they can present the card for a free beverage.

These types of cards are designed to be thrown away after the customer has collected a sufficient number of stamps and collected their reward. Once the customer makes their next purchase, they’re given a new card to start collecting stamps again.
Stamp loyalty cards are perfect for small businesses just starting to experiment with different marketing techniques. You don’t need to have an app or a website to use these cards, and you don’t need to take your customers’ details.

Points-Based Loyalty Cards

Points-based loyalty cards are like a step up from punch or stamp loyalty cards. Instead of getting a stamp when purchasing an item, the customer can earn ‘points’ for each purchase made. The number of points given out is usually based on how much money the customer spends.

Accrued points can then be used as cash (to be spent exclusively in your shop, of course). Alternatively, points may add up to rewards such as a free gift or special offer.
A well-known example of a points-based loyalty card system is Nectar. At Sainsbury’s, customers earn 1 Nectar point for each £1 they spend in-store. Once a certain number of nectar points have been accrued, customers can spend them on shopping, as they would a gift card. 100 Nectar points are currently worth 50p.

Points-based loyalty cards are, obviously, a lot more convoluted and trickier to implement than classic stamp loyalty cards. You’ll need to obtain your customers’ details to set up their account, and you’ll generally need an app or a website so that your customers can see how many points they have.

VIP Member Cards

VIP member cards are similar to points-based loyalty systems, but taken up a notch. These are special cards that give the customer “VIP status”. The possession of a card might grant them exclusive promotions, benefits, products or discounts that non-members don’t have access to.

These member cards may also involve a points system, or they may simply offer incentives for signing up and being a member, regardless of how much money is spent. An example of such a scheme is Tesco’s Clubcard. Clubcard members are offered special discounted prices on products. For example, a pack of sausages may cost £3 for normal shoppers, while Clubcard holders only have to pay £1.50.

VIP member cards can also be tiered. This means that you can climb a tier system depending on how much money you’ve spent with the company overall. Higher tiers of membership unlock better benefits.
Most VIP programs are free, but some cost a fee to enter (e.g. Costco membership or Amazon Prime).

Are Loyalty Cards Worth It for My Business?

Loyalty schemes can work magic for any business, whether you run a small, independent company or a multi-national corporation. Studies have proven time and time again that retaining customers is crucial for any business’s success, and that loyalty schemes are a great tool in this.

75% of consumers claim they’d be more likely to make another purchase with a company if they’d received an incentive of some kind. This makes sense – after all, if you’ve already got 3 stamps towards a free coffee at your local café, why would you go anywhere else?
Yes, it will cost to implement a loyalty card scheme – but as it costs five times as much to attract a new customer than it does to keep an existing one, it’s absolutely worth it. It’s up to you what kind of reward you offer – it doesn’t need to be a particularly expensive ‘prize’, just as long as it’s attractive enough to keep your customers coming back. And you’ll easily make back any money you spend on a loyalty card scheme, as your customers will spend more money with you than they would have otherwise.

Offering a loyalty card scheme means that your past and existing customers are motivated to keep coming back to you, rather than visiting a competitor. Whether you’re a café, a hairdresser, an MOT centre or an airline, a loyalty card scheme will help you retain your long-standing clients.

Where Can I Buy Cheap Loyalty Cards?

If you’re looking to start up a loyalty card scheme for your small business, we’d recommend starting out with a simple hole-punch or stamp loyalty card. At 123Print, we stock a huge range of loyalty card designs, so you’re bound to find one that will suit your company’s aesthetic.
We also offer a blank loyalty card template, so you can create your own design entirely from scratch. Feel free to upload your own logo or artwork, and edit the text, font and colour to your liking.

Our straightforward pricing means the more you order, the more you save. Our loyalty cards are printed to the highest quality on sturdy cardstock cardstock, and are designed to be stamped or hole-punched with each purchase. When the card is spent and the customer wants to redeem their freebie, you can simply dispose of the used card with your paper recycling.

We also sell rubber stamps, perfect for marking your customers’ loyalty cards when they make a purchase. Choose from one of our designs or upload your business’s logo for a truly personalised stamp!

You’ve more than likely heard the saying that ‘first impressions count’ and it’s true; if you don’t give a customer or client the right first impression your chances of developing a lasting impression, and working relationship, become slim to none. We all go to great lengths to make a great first impression, whether it be developing websites with an elegant design and spectacular usability, or dressing in a tailored Versace suit with matching high gloss, raised print business cards.

However, in today’s fast and furious world we spend so much time worrying about how our first impression looks that we somehow seem to overlook the fact that if we don’t make the right lasting impression with our customers we’ll lose them forever. Keeping an existing, loyal customer is far more cost effective than winning over a new one. You should be aiming to leave each and every one with a positive, lasting impression or your business, service or product.

And that’s what it’s all about, retaining the customer.

Fact: On average it costs 7 times more to find a new customer than it does to keep an original one.

Cracking this nut is harder than it looks as the world moves into hyper-speed. Our businesses becomes automated and our lasting impression becomes nothing more than a bland blanket strategy, built around utilitarian research taken in the hope of pleasing the majority of our customers. It’s no surprise that they’re less-loyal than ever. However, investing the time and effort to make a lasting impression upon every customer becomes hard work and sometimes money and effort can be better spent elsewhere.

But for the majority of small businesses, retaining customers is critical. It’s unreasonable for us to think we can continue spending thousands of pounds every month to attract new customers when retaining your original customers can cost very little.

All it takes is the right lasting impression.

Customer Service

For us at 123Print UK, we spend many hours, sleepless nights, days and months thinking and perfecting our strategies to ensure we make a great lasting impression with our customers. One of our key areas is customer service.

For a small business, having a great customer service strategy is one key area you can make a difference. Every business is going to have its occasional mistakes or misunderstandings with its customers, so ensuring you interact with your customers in a personal, human way is crucial in retaining them. We never use robotic answer or auto reply emails, and we always ensure we have a member of our customer service team available to talk to you about your order. For a small business this is a great area to develop a lasting impression, as with the number of smart phones, tablets and even smart watches available in today’s world, keeping tabs and in touch with your customers is easier than ever before; especially when you’re on the go.

Idea: Take advantage of smart technology by promising customers you’re always an email or phone call away. Deliver on the comments or queries made by them to ensure you make an effective, lasting impression.

Personalise it!

We touched on this briefly in our blog ‘Personalising your business’, as personalising certain areas of your business can be a boundless way to make a lasting impression. From the ‘thank you for your order’ email to delivering your product, there are hundreds of little ways you make your business more personal and stand out from the crowd, as it is the businesses who are delivering a personal experience that are leaving an excellent lasting impression and retaining their customers.

Idea: For us as a business stationery company we love the idea of dropping in a little handwritten note to say ‘Thank you for your order’ or creating personal discount codes which we randomly generate to surprise our customers!

At the end of the day it’s all marketing to us, but to the customer it is a gesture to show you’re a real person who is determined to impress and keep them coming back to your services.

Social Media

As you’ve probably heard by now, social media is a great way to keep in touch with your customers; and businesses are starting to discover and fully understand it’s a real tool for success.

Fact: 71% of people are more likely to buy from a service or brand they follow compared to its competitors.

For leaving a lasting impression with our customers we love to showcase (with their permission) their business stationery designs via our social channels. Not only do we love to see the different designs they create, but we love displaying the high quality of our products and designs. It really works in securing new clients as they can physically see our previous and current designs, but more importantly it gives our customer the chance to interact with us after the buying process with us.

All in all, making a lasting impression is something every business owner needs to take upon themselves and apply to their business. There is no silver bullet for retaining your customers and it takes hard work to meet the majority of your customers’ expectations. It’s important to remember as hard as you work to provide that great first impression which secures your customer, it’s just as important to remember to provide the work and effort that goes into developing a long last lasting impression which will motivate customers to keep coming back and using your services.

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What Are Loyalty Cards and Could They Benefit Your Business?