Family of regular customers

Discount programmes are powerful weapon in the battle for customer loyalty, regardless of your business niche. Even pharmacies, beauty salons and car service centres are offering customer discount schemes these days, besides traditional shops. Of course, there is psychological pleasure in gaining a ‘bargain’ and such moves certainly generate additional turnover for businesses. However, some discounts only become applicable once a customer has spent a large sum, making them out of reach for many. This two-tier system is leaving some citizens out in the cold, cynical about supposed discounts.

The first discount schemes appeared in the USA in the 1930-40s, as entrepreneurs endeavoured to encourage customers to ‘invest’ money into their businesses and banks tried to attract new customers by liaising with shops, restaurants and cafes to offer membership discounts. Later, in the 1980s, loyalty programmes really took off, especially for airlines, with their famous bonus miles schemes.

These days, few larger shops fail to offer some sort of loyalty card — especially those within a chain. Last year, Belarusians spent half of their income on food, so supermarkets are especially keen to ‘hook’ their fish in this competitive market. Retailers battle for customers by offering low prices, loyalty discounts and a host of special offers.

The main goal of any loyalty programme is to make customers feel proud of their membership, with an element of prestige. In fact, the idea is more effective than direct advertising. Attracting new customers is far from cheap, costing 3-5 times more than keeping your existing ones. Meanwhile, those with loyalty cards are carrying a constant advert, visible to friends and family. Discount cards are one of the most effective tools in creating a network of regular customers.

Ownership of a discount card also affects consumers’ behaviour: more than a third will postpone purchase of an item if the expected discount is significant and they don’t have their card with them. Just under a third will delay their purchase until they have their card with them even where the saving is quite small.

Chain store owners are ever planning new loyalty programmes to reflect changing trends in the market. Naturally, not all those who own cards become regular customers of a particular outlet or enterprise but it becomes more likely that they’ll return. As to whether customers actually save money in doing so is another question.