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3 Key Factors Of Any Credible Fan Loyalty Program

There are 3 factors of any credible fan loyalty program that the designers screw-up by out-thinking their own success, bogging down the system in order to be smarter than their customers. There’s no way around it, especially when it comes back to what the points actually deliver a patron when they buy into your system. The less rewards, the less significant time investment by the patron, the worse your loyalty program is. The issue stems from a lack of understanding how to build a strategy that increases both buying habits as well as credible benchmarks that drive customer activity continually. Several sports franchises, including the Buffalo Sabres, Pittsburgh Penguins and New York Jets have rolled out fan loyalty programs in the past few years.

1. Your Fan Loyalty Program Strategy Must Fit A Patron’s Actual Need

Too many fan loyalty programs stem from the idea of just getting the customer to buy more. What is forgotten is questioning what the patron wants, and surrounding that need within a loyalty program point system. When one of these programs is launched without a strategy in place, it becomes a quick dud. Because it fits no need of the customer, who feels no requirement to buy-in and start achieving their goals through a points system in order to reach certain buying benchmarks. Seems simple, yet at so many times, it is becomes over-complicated by those initiating the program.

In order to entice patrons to buy, franchise executives tend to create a convoluted, unimaginative system of fan loyalty. This is where there are high, unattainable benchmarks only accessible by purchasing the product several times over, through a system of points redemption via a card purchase or code punch-in. What’s worse is that, often, the lowest benchmarks are something that customers do not desire at all, therefore they don’t initiate investment into the fan loyalty program from the beginning.

That’s where the issue lies for the customer and the franchise executive: If there isn’t something that can be shown as a result, within a few purchases, of something that the customer even desires to possess, then the entire fan loyalty strategy fails, there is no increased purchase to buy thereby hindering transaction frequency, and interest is collectively dropped by patrons quickly.

A fan loyalty strategy must be similar to a dog race, where there is a small, fake but fuzzy bunny only a few meters ahead of the pack at all times. The desire beats out the realization that the bunny isn’t as interesting once it has been caught, but the dog doesn’t know that until reaching that final benchmark. Therefore, it is important to keep the smaller benchmarks as a compounding feature to chase after the truly important one.

2. Expiration Dates Must Motivate A Patron’s Increased Purchasing Habits

Equally important in the development of a fan loyalty program is the opportunity to have the unredeemed points expire if they have not been used after a certain period. This is helpful not only to the franchise’s bookkeeping staff, but also toward motivating patrons to continually spend within the fan loyalty program itself. Think of the way that Starbucks’ loyalty program requires a user to use its card/app 12 times within a calendar year, otherwise they will drop from gold status to green status. The difference being that the gold status allows for free drinks after every 12 purchases, and green statuses do not. This motivates patrons to purchase more coffee within a certain window, in order to keep their status and benchmark progress active.

No patron seeking attainable benchmarks will want those points to go away without a fight. All of those months have been spent earning them, so they are more than willing to spend more money to increase additional points, in order to reach a satisfying benchmark prior to the points expiring. This is how the airlines have continually fostered rewards point accumulation through their fan loyalty program. By increasing the value of the benchmarks, whether it be early boarding, waived luggage fees or a free flight, the airlines have kept their customers involved, especially with requirements that points expire if they go unused within a certain period of time.

This is about developing a continual maze for the customer. No matter where the customer turns, they find themselves moving forward, toward the collection of additional points, because of their previous investments already made in the fan loyalty program.

3. If Your Benchmarks Stink, The Fan Loyalty Program Does Also

When determining fan loyalty program benchmarks (i.e. rewards) there must be attainable, smaller items that patrons want to earn. And those benchmarks need to be within a few purchases. There is no point in setting up a fan loyalty program if the franchise itself is afraid of customers actually redeeming something at all. But some of the smaller fan loyalty program awards are not required to be expensive. The majority of the early benchmarks can have fixed-costs, and end up increasing the upsize value for the franchise.

Several of the fan loyalty program early benchmarks should be coupon or discount items to where it is an upgradeable item. Early point redemptions should require an action that causes the patron who earned the benchmark to now spend additional revenue in order to achieve it. Typically, these are discounts on tickets or concession items such as soda pop or popcorn, where the margins are extremely in the favor of the franchise. This is to allow the patron to initiate further points accumulation, as well as increase their buying frequency.

But as points are accumulated, the potentials for an actual cost to the franchise in the form of a credible redemption reward for the customer must be present as well. Because as the patron is investing in the fan loyalty program, so should the franchise in what they are offering in return for achieving specific benchmarks with credible rewards.

When a customer decides to invest in a loyalty program, they are seeing the end-goal, not the starting accumulation that it will take in order to get there. This is where a sound loyalty program strategy can help motivate a patron to spend more, investing in the product through tickets and other point accumulation devices, in order to focus on the benchmark that they want. It is the responsibility of the franchise to set benchmarks which are both fair to the patron as well as the franchise, as they push forward, driving revenue at every point along the way.

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