High Streets Initiative · 14 July 2017

A customer reward scheme generating big-brand loyalty for high street independents

The Shop Local Club Card merchant terminal
The Shop Local Club Card merchant terminal in a local butchers
Business Advice meets the founder of a digital customer reward scheme promising to instil community loyalty to local high street retailers.

Loyalty cards are nothing new on Britain’s high streets. But, for smaller retailers competing against the levels of customer retention enjoyed by larger competitors, finding ways to reward regular customers within tight margins is increasingly difficult.

Nonetheless, there are two strands of benefits to a customer reward scheme incentivising new customers to make repeat purchases after their first visit, and earning the loyalty of regulars by giving them something in return.

The footfall benefits of a loyal customer base are also well documented. Research from the Chartered Institute of Marketing suggested a five per cent lift in customer retention could be worth as much as an 85 per cent increase in sales, with brand loyalists spending over three-quarters as much as a new customer.

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Meanwhile, Forbes has previously claimed it is seven times less expensive to keep a customer than to acquire a new one.

Nandos has always refused to officially confirm how its mythical High-Five loyalty cards are distributed
Nandos has always refused to officially confirm how its mythical High-Five loyalty cards are distributed
Unfortuntely, bespoke app development is expensive. So too is replicating the Nectar model, and can customers really be relied on to keep hold of loose, stamped cards? For smaller stores, a worthwhile scheme means responding to the modern habits of consumers.

To help Britain’s small businesses generate the levels of retention enjoyed by high street giants like Nando’s and Caf? Nero, one mobile application is offering founders a simple way to create their own tailored customer reward scheme.

Marcus Naidoo, founder of the Shop Local Club Card, sat down with Business Advice to explain how his own venture is supporting local retailers in communities across the UK.

our aim is to the bring big-brand loyalty and marketing tools from companies like Tesco and Starbucks to local independents at an affordable price, Naidoo explained. Adding further detail to his mission statement, he said arming small firms with the tools needed to challenge their corporate neighbours was fundamental.

Simply put, the app utilises mobile and cloud technologies to act as a digital loyalty card solution for independent traders.

Outlining how his product works, Naidoo gave an overview of two popular schemes used by local business owners.

typically, our shops are using both stamp cards buy five coffees get one free? as well as points collection, which will be turned into vouchers at varying rates from two per cent cashback to five per cent.

Naidoo was keen to point out how the app’s versatility created opportunities for all kinds of small businesses. The program is very flexible and works in butchers, fashion retailers, stationery shops. It will even work for dog walkers, he added.

each business is only limited by their imagination and can give all sorts of rewards, from a high-five to money-off vouchers. And, of course, free coffees.

The app's stamp card screen
The app’s stamp card screen

 
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ABOUT THE EXPERT

Praseeda Nair is the editorial director of Business Advice, and its sister publication for growing businesses, Real Business. She's an impassioned advocate for women in leadership, and likes to profile business owners, advisors and experts in the field of entrepreneurship and management.

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