- 29 Aug, 2013
- Boris Bogaert
- 0 Comments
- loyalty, marketing, prepaid,
Here at Cardwise, we try to make our customers (and users) happy day after day. We do so by providing the best possible customer service, as well as product innovation based on client feedback.
Why do we do that? Because we love our clients, and know that happy clients are loyal clients!
Subscription companies are loyalty-based companies
If I take a look at the bills that reach my mailbox every month, I’m amazed by the subscriptions I have running at the moment: internet connection, mobile phone subscription, insurance, gym, … I pay for them month after month, and my “subscription spend” is increasing monthly. The last thing I added was my premium Spotify account. Another $9,99 added up to my subscription spend.
I pay for some of them because I really need them. What would I do without an internet connection? What would I do without any insurance? How would I stay in touch with friends and family without my mobile phone?
This doesn’t mean that I need the service provider. There are plenty of mobile operators to choose from, there are a number of insurance companies out there, and it doesn’t matter if I work out in gym A or B.
So for these kinds of companies, marketing should focus on loyalty rather than acquisition.
What makes customers loyal?
The answer to that question can be the holy grail for lots of companies that are struggling with their retention.
When I look at the services I’m currently using see different strategies:
- Telco’s tend to lock-in their clients using 24-month contracts, offering very cheap rates during the first few months or so. This means acquisition and loyalty all in one. Booyah! But after six months clients see the actual amount to be paid every month and they realize they’re tied to the Telco for another 18 months.
- Insurance companies have the benefit of offering dormant services. As long as you don’t have anything to report to your insurance broker and you don’t feel the pain of dealing with [insurance things] you probably don’t even consider of going to another broker. Another advantage: alle verzekeringen bij 1 maatschappij = minder betalen
- The local gym (and other local businesses) tend to use real loyalty programs, like a certain discount after ‘x’ amount of purchases. Rewarding your clients the old fashioned way doesn’t always work. People have to make sure they keep their receipts, or carry some kind of loyalty card. Another question to keep in mind: do your customers really want that freebie you’re offering?
Cashback as inspiration for loyalty programs
There are a lot of brands doing cashbacks. Customers fill in a form after they’ve purchased an item, and ‘x’ percent of the amount paid gets reimbursed. One of the main problems for consumers is that have to wait a couple of months to get the money back. And they only get the money if they fill in the form. You would be amazed to see how many people don’t fill in the form!
People prefer money instead of coupons or freebies, but a cashback (in most of the cases) is tied to a one-time purchase like a television or a mobile phone, so it doesn’t really stimulate loyalty.
Could cashback be the next big thing in loyalty programs?
In the way we know cashback today: No, it is too much of a hassle to fill in a form every month to get reimbursed. And the loyalty programs that you are running aren’t doing any good to your business.
In the way we define cashback here at Cardwise: Yes! One of the solutions we offer to our clients are prepaid MasterCard’s.
We offer cloud based solutions, API’s, etc. to transfer money in real time to a prepaid MasterCard of your customer! When a brand wants to offer prepaid MasterCard’s to clients or employees, we provide all the tools needed: cards, platform, configuration, …
But that’s not the only thing we do! We come up with ideas to solve the problems our clients are facing.
Loyalty is one of the things many companies are struggling with, and a prepaid creditcard+ Reward solution enables companies to build long lasting relationships with clients.