Why Digital Agencies Should Adopt an Automated Loyalty Solution as Part of Their Offering

As an internet-savvy and generally curious person who works in the tech industry, I come across a lot of marketing-related content.

An often recurring theme of these articles is client acquisition strategies: defining the right audience for your product, generating awareness, creating the right funnel, understanding the right platforms, etc. 

There’s no doubt that busy business owners understand the power of digital marketing and its ability to generate new leads and customers. Acquiring new users online has been the go-to strategy for the better part of the 21st century.

However, only very rarely, I come across articles emphasizing the importance of customer retention, and having a clear customer loyalty strategy set in place. This makes me wonder, are marketers not familiar with their options in the field of loyalty? Or are they not aware of the many advantages a business gains when it is able to retain its customers?

Customer acquisition vs. customer loyalty

As studies have repeatedly shown, a mere 5% increase in customer loyalty increases profits by a whopping 25%-95%, since returning customers spend more regularly.

It has become clear that returning customers are actually much more valuable for any business than new customers, even though the acquisition of a new customer can cost up to 5 times more than retaining an existing one. Nevertheless, agencies still tend to focus much more on customer acquisition, despite clear data showing it breeds a much lower ROI.

So why don’t digital marketing agencies tackle customer retention issues, and add loyalty-optimization methods to their portfolio of services? For two main reasons:

  1. Work overload – customer loyalty management has traditionally taken valuable time and effort, and it is thought of as a lot of hassle for busy business owners.
  2. Tracking results – as opposed to user acquisition, understanding the ROI of investing in customer loyalty can be a bit tricky, asit is more difficult to assess how much exactly your business has gained from these efforts.

Automation as the future of loyalty

With Glue’s fully automated loyalty platform, these concerns are now gone. Glue helps busy business owners to set up a customized loyalty program that suits their business, and automatically runs it for the business owners – individually communicating with each one of their customers.

Then, by using the platform’s clear business dashboard, they can easily track their loyalty program’s results and understand how it has contributed to sales growth. In fact, most of Glue’s business owners make it a daily habit to check their loyalty results through their mobile devices.

The power of local communities

Since COVID-19 broke into our lives at the beginning of the year, small local businesses have been struggling to keep their heads above ground. Small business sales in most industries have sharply declined, and business owners are desperate to retain their customers in order to keep the business alive.

On the brightside, as people stay closer to home, shopping at their local neighborhood shops has become a necessity. Moreover, initiatives to support local businesses are on the rise and have actually become a movement emphasizing the importance of shopping local and supporting one’s community.

Digital agencies can leverage this movement and offer local businesses support in maintaining their local clientele, in order to reach the full potential of their clients’ nearby community and customers. I argue that a shift in paradigm – from how to obtain new customers, to how to reach the full potential of your existing customers – is much needed these days.

Taking part in these “Shop Local” initiatives also means encouraging local businesses to provide their customers with special offers, and by doing that, incentivize customers to continue their support for local businesses in their community.

It’s basically an agreement based on trust between local businesses and their communities – consumers shop local, while business owners in turn, reward their customers for their loyalty. The cycle repeats itself.

The perfect way for digital agencies to achieve this goal is by incorporating a digital customer loyalty solution as one of their services.

Traditional marketing is expensive, difficult, and time-consuming. Considering how businesses  find it difficult to sustain successful marketing campaigns, an automated, hassle free, loyalty solution is an additional service that will certainly come in handy for your clients.

Loyalty programs create goodwill, help spread the word around for free, and encourage existing customers to spend more, much to your clients’ delight. 

As a result, automated loyalty program such as Glue is can be a valuable weapon in your arsenal. Glue helps you create reward programs that are specifically suited for your clients’ customer base. In fact, you can create multiple loyalty programs, each custom-tailored for specific segments of the customer base.

This helps create and retain an interest in the targeted brand for prolonged periods of time. In addition, people are automatically drawn towards brands that provide positive reinforcements. Rewards, also known as positive reinforcements, have a powerful psychological function, and they repeatedly elicit desired behaviors.

A good loyalty program understands the psychographics of your clients’ customer base, and creates reward programs that are most appealing to them. This establishes a strong emotional bond between customers and the clients’ brands, while timely rewards further act as a seal.

You can easily track and analyze customer behavior, and the success of loyalty programs. You can also use data and insight to tweak and make changes to your loyalty programs so that clients can reap better results quickly. 

Loyalty programs combine consumer psychology with modern technology

To sum up, an automated loyalty program is a powerful weapon in your marketing arsenal to help your clients. With the help of operant conditioning which is rooted in behavioral psychology, modern data analytics, and business intelligence, you will be able to create campaigns that sustain and nurture your existing customers.

In the long term, this will work out to be much cheaper for your clients than expensive marketing and ad campaigns. And clients that save money and see results will be happier than the ones who end up spending a lot more on traditional marketing campaigns.