Gaining loyal consumers can give your business a fillip. Loyalty program tracking is essential to help figure out the right and wrong in the strategies.
FREMONT, CA: Loyalty is an essential parameter for a company to measure how well it is performing. Loyalty programs are integral for the companies which wish to generate effective loyalty from their consumers. The effect the loyalty programs have needs to be evaluated from time to time to check if it is working well or not. Analyzing and tracking the program can provide one with a lot of insights about the value of the program as well as specific aspects of loyalty among the consumers. The following are a Key Performance Indicators (KPI) that can provide answers to how adequate the plan is after adoption.
• Visibility and Conversion
The buyer's offers that a company provides need to reach the largest possible number of consumers. Unless they know about it, the offers are of no use. Hence, visibility is an important KPI, and companies can test the visibility and outreach of an offer to gauge the success of loyalty programs. The number of consumers who opt for a particular offer is another key criterion. It is a direct measure of the success of a program. The proportion of people who sign up with respect to all the views is a vital metric.
The offers can help onboard consumers during the free trial periods, but the actual effectiveness or loyalty can be measured by considering the proportion of people who stick to a product or service even after the offer ends. Measuring the value of customers by comparing the duration of their stay with the cost the company incurs for them gives companies a way to calculate the degree of success of their loyalty program.
• Value of Purchase
If loyalty programs are running successfully, there will be an increase in the average order value. This is a metric that helps to track the loyalty program. Along with the increasing value of purchase, the frequency of purchase is also an essential KPI. The revenue generated cannot be directly linked to the success of a loyalty program, but it is also one way of figuring out the overall success.
All the metrics discussed here are very dynamic, and companies should approach the tracking of their loyalty programs with a lot of flexibility. Companies shall continue testing and analyzing to arrive at the best formula.