Loyalty Programs are a simple and proven way to increase sales and revenue for coffee shops. They help not only to retain existing customers and increase customer spend but also by attracting new customers into your coffee shop. We have listed out a few tips for how coffee shops can increase their sales and revenue through their loyalty scheme, to hopefully convince you why the super simple addition of a loyalty program to your business could be the difference between a customer buying from you over a competitor.
Keep your Loyal Customers Happy! 😁
Firstly, a coffee shop having a loyalty scheme will encourage repeat visits from existing customers. By offering a reward or a discount to a customer for purchasing from you multiple times, they are more likely to choose your coffee shop over competitors. They feel like they are working their way up to completing a task for a reward, and who doesn't love a free treat? This promise of a reward not only increases the frequency of visits but also the amount spent per visit.
If you have a customer walk into your store once, they might buy a coffee and leave. Two times - again they just get a coffee and leave. Then on that 3rd or 4th or 5th visit, they might be a bit hungry, so they buy a pastry or a sandwich with their coffee this time. Or maybe on their 7th visit, they convince their group of 3 friends to come along with them as they are sooooo close to completing their stamp card. And what do you know? They all collect a loyalty card and get their first stamp!
A loyal customer is worth so much more to you than the purchase of 7 or 8 coffees, with a well-designed loyalty program you can build a loyal customer base and increase the lifetime value of each customer.
Say Hello to New Loyal Regulars 🕺
Secondly, a loyalty scheme can be used to attract new customers. If you offer a sign-up bonus or discount to customers who collect their first ever stamp (50% off your first coffee, buy a coffee today and get your next one free, etc.) then new visitors to your shop won't hesitate to sign up. Once they have that first stamp, or are incentivised to return to your store to collect a discount, they are now creating a habit of visiting your shop and buying coffee from you over a competitor. Creating these habits and getting the customer used to your product and shop gives you the opportunity to wow them with your amazing service and coffee so they know there's no need to look anywhere else, they’ve found their new favourite coffee shop!
From talking with over 1000 coffee shops, we know that offering a ‘Buy One Get your Next One Free’ for new customers is the number 1 way to ensure that customers come back into your shop. You might think that they would just go in to collect that free coffee and then they are never to be seen again.. But in reality the exact opposite is true! Customers who are rewarded for returning to your store to collect this free coffee, are 3x more likely to buy from you at least 5 more times!
You Can’t Put a Price on Feedback From Your Loyal Customers 📝
This point here is a great added bonus of a loyalty program that some people don’t ever think of! Your loyalty scheme can be used to promote specific products or services that you want to highlight. Got a new pastry you want to start selling? Have a new Coffee Blend? Releasing a new Menu? No one can give more insightful and honest feedback on these things than your regular customers who have been loyally visiting your shop day-in day-out. You can give out 100 free samples of a new item, but if they are given to people who are just passing through town, then what good is their feedback?
Some loyalty programs allow you to directly communicate to the phone of your most loyal customers, so you can tell them what’s new and you know it’s being heard by the VIPs of your business.
It’s all in the Numbers! 📊
Finally, one of the most important benefits of modern loyalty programs is that not only does it keep your loyal customers happy, but it can feed you back data about your regulars so you can learn how to find more of the same people! Really knowing who your loyal customers are and what they do, and being able to act on that knowledge is what makes the difference between a good loyalty program and a great loyalty program.
Let’s say you have 100 people using your loyalty program, if you knew that 70 of those customers were females between the ages of 19-23, this means that that group really resonates with you and your store! With that information you can then make business and marketing decisions to more heavily target this demographic so more of them can find out about you! Being able to target this demographic will majorly increase the customer experience and overall make your customers happier!
In conclusion, a loyalty scheme is a proven way to increase sales and revenue for coffee shops. By encouraging repeat visits, attracting new customers, increasing the average spend per customer, promoting specific products, and providing valuable data insights, a well-designed loyalty program can help coffee shops to build a loyal customer base and grow their business. 💰
If you are interested in learning about how SQUID Loyalty can help you with all the above and more, please don't hesitate to send us a message! We would love to chat with you over on [email protected]! 🦑