Rewards programs are a great incentive for shoppers to buy at your store—while saving money for themselves. Studies show that 76 percent of Americans think of loyalty programs as part of their relationship with brands, and 46 percent of shoppers who use loyalty programs consider them to be important in their decision to purchase.
But the rewards coupons and punch cards of yore are easy to misplace, and patrons can easily forget about them. That’s why even small retailers are moving to digital loyalty and rewards programs that track points without pesky printouts or physical cards. Storeowners stand to gain, too, with advantages beyond repeat business: They can track how well rewards work, gain insight into customers’ buying habits and stay engaged with customers through yet another communication channel. We spoke to a few savvy dance retailers who have made the switch.
A New Way to Engage
With a showroom of more than 6,000 square feet, DanceWear Corner is the largest dancewear retailer in Central Florida. DWC’s president, Jon DeMott, used to offer punch rewards cards, but in 2013 he switched to the digital marketing software CityGro to handle his customer rewards. Customers simply register with their mobile number on iPad kiosks set up in the store, indicating what information they’re interested in receiving from DanceWear Corner. Then they can access their rewards via the kiosks each time they visit the store. The CityGro loyalty marketing software “is designed to help you get your message in front of customers, find new ways to engage and keep people coming back,” according to the company’s website (citygro.com).
DanceWear Corner sells a wide selection of apparel and shoes for ballet, gymnastics and specialty dancing; one of the store’s incentives is a $10-off voucher for every $200 spent. Throughout the year, DWC also offers a free birthday gift and flash sales. DeMott says that “customers seem to enjoy the simplicity of the program and having it at the register area. They like not needing to have a physical card.”
Since DeMott converted to CityGro, he no longer has to deal with rewards-card fraud (customers combining cards for bigger rewards or duplicating cards) or issue replacement cards. “Everyone carries a smartphone, and [most people] would rather lose their wallet than their phone. So we are always able to reach our customers,” says DeMott, who especially enjoys CityGro’s texting option for specials and other announcements. The one downside, he says, is “keeping the iPads updated, charged and connected to Wi-Fi.”
A Boost to Spending
A year after Gabie’s Boutique in Newmarket, ON, Canada moved into a new 3,000-square-foot space, co-owner and manager Amy Manning launched a new digital loyalty program, the Pirouette Points Program. It runs through the store’s MultiPost POS system.
Shoppers create a customer profile that will track all of their points in-store. They earn a point for every regular dollar spent, and once they’ve earned 350 points, they can start to redeem points. Or they can hang on to points for dollars off future purchases. Each receipt shows the number of points the customer has. “Our customers love it,” says Manning. “It’s an easy way that we can reward, based on how much they are spending. The more they shop here, the more they are rewarded, so it benefits both parties.”
The boutique, which was opened nearly 37 years ago by Manning’s mother Gabie, has a strong reputation in the regional dance community for its expertise and customer service. “Customers who shop here for everything and have multiple children who all do competition will reach the reward levels faster,” says Manning. “It will take longer for a customer who comes in every now and then and shops elsewhere or online, [so the rewards program] may encourage them to shop with us so they can redeem faster.”
Manning says the loyalty program’s only drawback is that rewards redemption can cut into her bottom line during slower periods. “Once a customer has reached a redemption level, they can use their points,” she says. “So this can be tough if we have multiple customers redeeming points, especially at higher dollar values, in our slower times of the year.”
One More Marketing Tool
In 2015 The Dance Shop in Altoona, PA, created a digital loyalty program called Dance Shop Dollars. This replaced the printed coupons the store used to give customers who spent a certain dollar amount. “The last thing my customers want is one more card to carry,” says owner Micki Samson. “There are no expiration dates, no coupons to keep, no card to carry. It’s right in our POS, and it works on sale items, too. You earn one point for every dollar spent, and after you have earned 100 points, you have $5 to spend on your next purchase.” Customers have responded well, says Samson, and “we have even made a couple add-on sales when we tell them how much ‘free money’ they have to spend.”
The Dance Shop Dollars program is linked to the 3,200-square-foot boutique’s e-mail list, so Samson can send marketing messages directly to customers and remind them about the program.
The only concern Samson has about the program: Is she making it too easy for customers to save money? Discounting can devalue a store’s brand, after all, and cut into margins. Samson’s loyal customers already benefit from her monthly sales, flash sales, teacher discounts, quantity discounts and occasionally double points. She is considering tweaking the program a little bit, perhaps leaving it up to the customer to tell the cashier if they want to use their points rather than making it the responsibility of the cashier to ask.
As always, the trick with any loyalty rewards program is finding the right balance between giving customers an incentive that makes them want to shop with you and making sure your business is sustainable over the long term.
Tracy E. Hopkins is a Brooklyn, NY–based writer who has contributed to The Associated Press and Essence.
Photos, from top: (2) Collette Mruk, courtesy of DanceWear Corner; courtesy of Gabie’s Boutique; courtesy of The Dance Shop