Five fundamental factors of a successful loyalty program
If you read my last post on loyalty programs, you were hopefully inspired to think about how such a program could benefit your practice. But before you jump in head first, I would like to share the five fundamental factors of success.
At Vet2Pet, we have helped hundreds of practices implement loyalty programs, so we have a lot of data and insights into what programs work well. Based on a financial analysis of 20 U.S. practices that implemented our standard loyalty program, we discovered that: clients increased their annual spend by more than 10% after acquiring a loyalty program membership; and participating practices saw an average revenue increase of $55K within the year.
Can you expect similar returns if you set up a loyalty program? Absolutely, as long as you’re strategic and keep these tips for success in mind:
1. Keep the design of your loyalty program simple
I can’t stress this enough. Your clients will only participate in your program if doing so is easy and fun. A good gage of simplicity is the time it takes you to explain your program. If you can sum up how it works in 15 to 30 seconds, chances are you’re good to go. If it takes longer to explain than that, simplify.
Your program should be easy for your team to manage, as well. For example, one practice I worked with wanted to reward clients based on the purchase of services only, but not products. Imagine the challenge their reception staff would have had with the extra time involved in calculating how much of every invoice qualifies for the reward, and explaining, for example, why that $85 bottle of Rimadyl the client is buying doesn’t qualify.
Money spent is money spent. Reward it all. It will come back to you, I promise. Plus, rewarding product purchases incentivizes your clients to purchase from you, instead of from Walmart or a shady online pharmacy.
2. Make sure all your veterinary practice clients can participate in your program
A loyalty program is an amazing way to reward pet owners for taking great care of their pets. Click To Tweet So it is important that every one of your clients can participate, regardless of whether they have a healthy new puppy or an old, hyperthyroid cat.
If, say, you only offer rewards points based on the purchase of a Wellness Plan, then you are only rewarding those clients with healthy pets. That is why spending-based programs are the best. It doesn’t matter what kind of pet you have. What matters is what your invoice total is.
3. Make it easy for pet owners to earn rewards for their loyalty
A friend of mine recently told me about a travel reward program she used to participate in. After collecting points for years and years, they still hadn’t amounted to anything tangible. Finally, she gave up.
4. Offer your clients high value rewards that help them care for their pets
You know your clients want to take great care of their pets. They wouldn’t be your clients if they didn’t. If the reward you are offering is not going to help them do just that, they will not be as keen to participate.
Keeping that in mind, which reward do you think your clients would prefer to receive after spending, say, $1,600 in your practice: a free, branded t-shirt or a $100 credit towards their pet’s next dental cleaning or chronic pain medication?
To reiterate, your reward should also be something that all of your clients can use. If, for example, you are offering a free night of boarding, then only a select number of clients are going to be interested.
Speaking of rewards, it is important to keep in mind that rewards are not the same as discounts. In fact, rewards programs can actually discourage discounting. But I’ll share more about that in a future blog post.
5. Gamify your loyalty program to encourage participation
|That’s right. Get your game on! Invite your clients to be active participants. Research suggests that participants feel far more fulfilled when they’re actually required to do something to earn their rewards. That’s why, in the standard loyalty program that I talked about in my previous post, we don’t simply give away points for every dollar spent. Doing so would defeat the purpose of the up-sell at the front desk.
Instead, we offer points for every $100 spent per invoice, which incentivizes clients to play an active role. In doing so, we build engagement, which builds excitement, which leads to greater participation and rewards for clients, and greater revenue for your practice.
Now that you have the five fundamentals, it’s time to set up your program. A great place to start is by looking through your VetSuccess reports. Where are your areas of opportunity? Once you identify those, you can tailor a rewards program that will help you target those specific areas.
Want to see a higher ATC? Revenue not as high as you would like? Consider the standard loyalty program mentioned above to encourage clients to spend more at each visit. Retail revenue down? Encourage the up-sell and reward your clients for purchasing food and parasiticides from you instead of going somewhere else for them.
Problems with lapsing clients? That will be a thing of the past when you start rewarding them. Click To Tweet Want to increase dentistry, or compliance in some other specific preventive care service? Then be sure to read my next blog post on tiered rewards and seasonal earning sprints.
Once you’ve set up your loyalty program, consider asking a neutral party for feedback
It never hurts to get an outsider’s perspective. They may well think of something you didn’t. Once you’ve done that, go back and make sure your program meets all of the five requirements above. If you can check off every box, you are ready to start rewarding your clients!