Building loyalty

The Pareto 80:20 ratio would indicate that the top 20% of your customers will generate 80% of your revenue (although I have seen 95% turnover generated by the top 5% of customers) so in these tough economic times nurturing your top customers will benefit your organisation’s turnover. However, a loyalty programme is a long-term commitment not a short-term sales tactic, so it is important to ensure that every aspect of the programme is planned.

1. SMART objectives – specific, measureable, achievable, realistic and timed. If you don’t know what you are trying to achieve, you can’t measure success or progress. Many friends’ programmes have evolved with no clearly defined objectives or measurement of success.

2. Set membership criteria and stick to them, e.g. membership fee, customers with a high spend or regular attendance. Membership requires value. Often the value is money-related but lies in something different, such as an experience that money can’t buy, e.g. attendance at full dress rehearsals, friends’ events, meeting the director.

3. Conduct a customer journey within your organisation and identify all your customer contact points or ‘opportunities to delight’. Make your members feel special – this can often be done through recognition rather than rewards at each contact point identified. This is an area where many loyalty programmes fail to deliver, as front of house staff are often insufficiently briefed or engaged with the details of the programme, perhaps seeing and referring to it as ’marketing‘.

4. It is vital that all administration support is working optimally for the scheme and any front of house staff are fully briefed and trained up. Whatever grand scheme you have will fail without full admin support. Regular internal briefing and involvement of all areas in updates and input to the scheme is required for full buy in – including some ‘mystery customer’ checking to ensure everyone is treating members as expected.

5. Promote your scheme strongly in every available marketing option – tickets, mailings, internet, phone-hold messages, etc. Ensure the entire organisation supports the programme and it is not just a marketing initiative as identified in point 4.

6. Make it meaningful – don’t offer discounts that are already available. These are your most loyal customers, treat them accordingly.

7. Incentivise your members to get more members – it will be your most cost-effective marketing route.

8. Commit for the long term. This is not a quick fix or marketing tactic. It is a long-term scheme.

9. Consider sharing or extending your loyalty scheme with other arts organisations for mutual benefit. It is the future and already happening in the USA.

10. If it isn’t achieving objectives, then be prepared with an exit strategy as you will have members who are potentially upset and this requires careful management.

It is predicated that the most creative will survive the current economic climate by adapting or re-evaluating their core values and assets. Your loyal customer base is one of your key assets – now may be the time to offer them more value and involvement with your organisation, making them part of your community and ultimately your best advocates.