“A 5 percent increase in customer retention can lead to an increase in profits between 25 and 95 percent.”
- Increase profits from 25% to 95% 95%

12 Pros For Loyalty Programs
Attract New Customers
When consumers are looking for a new business, they find that all the businesses look the same. This is especially true when talking about small businesses with little brand awareness. Have a reward program could be the difference between the consumer buying from you or your competitor.
Cross-Branding recognition
Even a not-so-well known company can benefit on the brand reconition of other higher profile companies through affiliation with a common loyalty program. For example, if someone sees the Air Miles, Aeroplan logo in a store window, there is automatic brand recognition.
Increase Your Product/Service Value Proposition
The right Loyalty program can increased the value of your product brand, increase availability, and itcan also neutralize a competitor’s program.
Provide A Differentiated Service To The Best Customers
The right Loyalty Program can reward different customers diferently, acccording to their value to the business.
Communicate With Customers
Loyalty programs CRM’S can stay in touch with customers ensuring that public awareness of both the business and brand stays high. Top of mind awareness will entice consumers to make future purchases.
Get Insight Into The Effectiveness Of Your Marketing
Evaluate specific promotions and identify profitable customers by tracking customer purchases. An effective Loyalty Program has data tracking abilities that enable you to determin which customers respond to targeted advertising, what customers buy, what they might buy and how they can be influenced.
Get Insight Into Customer Behavior And Preferences
The right Loyalty Program can reward different customers diferently, acccording to their value to the business.
Be Profitable
American Airlines’ AAdvantage program and Air Canada’s Aeroplan are examples of successful loyalty programs that have generated significant revenues by selling “miles” to partner businesses. (Aeroplan, now owned by AIMIA, often earns far more profits than Air Canada, the airline which started the program).
Customers Make Additional Purchases
Consumers can be enticed to buy more than they normally would have without an incentive program. The closer you can get them to achieve an award the more you can get them to spend.
Win greater share of Wallet
In a world that is ultra competitive businesses can by using lyalty programs incentivize consumers to direct more of their purchases to their business and less at their competitors.
Keep Your Customers From Leaving
Customers will continue to patronize a business or Loyalty Program because they focis on the amount of points they have already accumulated. They become locked into the program despite the fact that they may not feel truly loyal.
Collective Advertising And Cross-Business Promotions
I a Loyalty Program that is made up of many businesses, each participating business pays for its own promotional materials. The ability to advertise cost-effectively is the advantage of this type of collective.
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