Give to Get

As a contrast to the Dairy Queen with the “Like” sign that I discussed last week, this week I read a story about Dave Reasner, another Dairy Queen franchisee in Rochester, Indiana, who wanted to launch a loyalty program to customers with mobile phones. His goal was to register 1,000 customers by the end of the launch period.

He started with putting printed bag stuffers into the order of every customer who came through his store, both in-store and drive-up. The message on the stuffers was ‘Sign up with our program and get a free Blizzard.' "We bribed them,” Dave said.

It worked. To get the free blizzard, customers opted in to receive text messages and submitted their short codes to do so.

His bribe helped Dave reach his goal of 1,000 sign-ups by the end of his launch period. Originally, he had implemented the program to steal customers from his competition. "Our main thrust was to build a loyalty program and a base of customers that would get rewarded, periodically, for coming to our store," he said.

Soon he discovered that his loyalty program was a way to stimulate sales. He offered a Blizzard Happy Hour from 2:00 - 6:00 p.m. which he unexpectedly announced to his loyalty program customers via text message at 11:00 a.m. the day of the Happy Hour. This was not a regular event and was only communicated to customers who were signed up for the loyalty program. Four to six percent took advantage of the offer, adding sales at a slower time of day.

He also set up a kiosk at his store where loyalty customers could print out coupons. This stimulated additional sign-up. Loyalty customers using the coupons would be asked by other customers, “Where did you get the coupon?”

The loyalty program customer response of “Oh, I’m a member of their loyalty program” usually prompted the questioner to sign up and become a loyalty member, too.

Dave did a good job of marketing with his loyalty program. First, he thought the program through and knew what he wanted to do. He set a quantifiable goal which he could check to see if he accomplished it.

Second, he developed his current customers by offering them the loyalty program. He gave them the opportunity to be in the program by telling them about it via the bag stuffers. He further developed them and the program with the in-store kiosks. By doing this, he followed a profitable way to grow his business by getting customers to do business with him more frequently.

Third, he employed the “Give to get” attitude. He didn’t just ask customers to join the program; he rewarded them with a free blizzard for joining. That was a $4 freebie. To those customers, it wasn’t the money that mattered. They were after the free treat. They got the free treat, and Dave got their opt-in.

Fourth, he used the program. One of the biggest mistakes business people make is setting up a loyalty program and not using it. Dave used it to stimulate sales and wisely did so at times of the day when sales were slow. He used it on a regular basis. He added a kiosk to give loyalty customers more and to prompt additional sign up.

If created and used the way that Dave did, loyalty programs are smart marketing. They encourage more business from current customers. They expand the frequency of those customers’ transactions. They keep a business at the top of the customers’ minds.

How can you use a loyalty program in your business?