How to Start a Loyalty Program: Part 1 Goal Setting and Research


Keep this from being your business!

What is a rewards program?

Customer rewards programs or incentive programs are designed with the goal of protecting the customer relationship. They can be in the form of a customer loyalty program, a discount program or promotion program.


The importance of cultivating these relationships not only lets the customer know you value them but can help you achieve all of your sales goals. However, an overwhelming amount of rewards programs fail. Why?

Reasons why rewards programs fail

1. Not targeting your specific market

2. Low enrollment

3. Lost cards or codes make rewards ineffective

4. Wrong rewards program for your business

But the root of all of these problems is…

lack of planning and goal setting


This upcoming series will go through what it takes to develop an incentive program for any business along with how to make it successful!

Step 1: Goal Setting


Define a Goal

A rewards program is meant to accomplish one of your business goals. We’ve encountered many business owners who want to start a rewards program because they think it would be nice to reward customers or just think that they should. While this is a good notion, the opposite often ends up happening.


Without defining a goal for yourself, a rewards program can often times become a burden and time sucker from your effective sales strategy. Even with the best intentions (to reward customers) without working toward a goal, pushing the program falls down on your priority list. Taking a little bit of time and thought to developing a program will set you up for success!


Types of goals rewards programs can achieve:


1. Attract customers at certain hour or day

2. Attract new customers

3. Retain one-time customers

4. Push a marketing plan

5. Increase customer referrals


Research: Gathering Customer Data

A great way to figure out where your business can improve to to turn to your vape point of sale to gather customer data.

By using customer relationship management (CRM) tools in your point of sale you can gather key information, such as:

  • Times of high and low traffic
  • Do new or recurring customers make up most of your business?
  • Could you maximize sales with lower prices at certain times?

to help you develop your incentive program goal.


Structure your goal in a way that you can measure results, for example;

I want to increase foot traffic in the store on wednesday afternoon by 50%

I want to convert half of our one-time customers to recurring customers.

Setting a goal this way will help you pinpoint exactly what you want to improve upon and develop an effective strategy for moving forward.

Stay tuned for the next in our series on types of incentive programs.

The Number One Reason Most Rewards Programs Fail and How to Avoid it

One thought on “The Number One Reason Most Rewards Programs Fail and How to Avoid it

  • January 15, 2015 at 8:55 pm

    Hey, thanks for the fantastic post. I feel much better after having read this.


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