How To Create A Customer Loyalty Program Using ManyChat And Facebook Messenger
When it involves getting repeat gross sales in your ecommerce retailer, buyer loyalty applications are one of the efficient methods to spice up buyer retention.
In reality, research have proven that 69% of shoppers are influenced by retailers that supply loyalty and rewards applications. Furthermore, 58% of shoppers store extra usually at shops the place they’ve joined a loyalty program.
Statistics don’t lie, and I do know for a undeniable fact that buyer loyalty applications work rather well on me:)
For instance, I’m going out of my technique to fly on United and Southwest as a result of I get rewards for the miles I’ve amassed. When it involves espresso outlets, I’ll hit Starbucks first as a result of each buy I make goes in direction of free drinks.
Surprisingly, only a few smaller 6 and seven determine ecommerce shops provide loyalty applications and right here’s the rationale why.
Most loyalty program options value some huge cash to implement and only a few cater to smaller on-line companies. As a end result, I made a decision to spin my very own buyer loyalty program answer utilizing Facebook Messenger Chatbots.
If you will have been following me on-line for any size of time, you already know that I all the time search for ecommerce implementations which might be simple and cheap:) As a end result, my loyalty program setup makes use of solely ManyChat. That’s it!
If you wish to copy my answer, be at liberty to observe alongside beneath.
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Why Implement A Customer Loyalty Program?
Before we delve into the heart of this tutorial, I wish to emphasize why a buyer loyalty program is so necessary in immediately’s ecommerce panorama.
After all, I used to be just a little hesitant to drag the set off at first as a result of determining all the little particulars requires an honest upfront funding of your time to get every part working.
First off, promoting on Amazon is getting rather more cutthroat. The Chinese are taking up and there’s rampant piracy all around the Amazon market.
Unless you will have a sturdy model and a stable fan base, you’ll ultimately get eaten alive by Chinese sellers who merely don’t observe the foundations.
In case you’ve missed them, listed here are some posts that I’ve written in regards to the rising competitors on third occasion marketplaces like Amazon, Ebay and Etsy.
Bottom line, if you’re counting on a third occasion market like Amazon for all your gross sales, you’re in bother as a result of you don’t have entry to your buyer info. As a end result, it’s unattainable to determine a model and entice repeat gross sales.
To display why repeat enterprise and branding are so necessary, listed here are some stats that can blow your thoughts.
According to Bain and Company, a 5% improve in buyer retention may end up in a 75% improve in income. Crazy proper?
At first, this quantity sounded just a little outrageous till I analyzed the numbers for my very own on-line retailer.
Here’s what I discovered.
Only 12% of my prospects are repeat prospects. But they make up over 36% of my revenues!
In addition, lower than 10% of my prospects spend over 2X the typical order worth for our store, however they make up virtually 50% of my gross sales!
As a end result, you will get essentially the most bang in your buck by merely focusing in your greatest prospects. And what higher method to try this than by implementing a buyer loyalty program!
Here’s a concise checklist of loyalty program advantages
- More Sales – Customers who’ve purchased from you as soon as are 60% extra possible to purchase from you once more. And Bain and firm says that even a 5% improve in retention can enhance revenues by as much as 75%
- Save Money – It’s less expensive to get individuals to purchase once more than to accumulate new prospects. For instance, once I run high of funnel advertisements to chilly prospects, I’m joyful after they convert at 2X. Meanwhile, my backside of funnel ads generate a a lot greater ROI.
- Customer Data – By gathering private knowledge about your buyer’s spending habits, you need to use this info to personalize their buying expertise. For instance, you may make prospects fill out a survey to realize extra perception about what they wish to purchase and when.
- Inspire Loyalty – A good loyalty program will create an emotional connection along with your model. Giving away free rewards factors is less expensive than freely giving reductions and they’re equally as appreciated.
- Better Communication – When a buyer indicators up in your loyalty program, it immediately signifies that they’re a possible excessive LTV buyer. This tremendously opens the channel for communication for these prospects as a result of you already know they wish to hear from you.
- Refer New Customers – A good rewards program can encourage prospects to refer their mates. For instance, you can provide away free rewards factors when a buyer refers their good friend.
The Different Types Of Customer Loyalty Programs
Customer loyalty applications have been round for a very long time and virtually each huge field retailer you may consider has one.
Here are the differing types of loyalty applications that you would be able to implement.
- Points Based
- Tier Based
- Fee Based
Points Based Loyalty Program
A factors based mostly buyer loyalty program might be the commonest kind amongst ecommerce companies.
Whenever a buyer takes a selected motion like a purchase order or referral, they’re awarded factors that can be utilized in direction of reductions and free merchandise.
Points could be rewarded based mostly on the full quantity spent or the variety of purchases made. And on the whole, it’s significantly better to maintain the rewards easy and simple to calculate.
For instance, I hate it when a retailer makes me do psychological math to find out how a lot I’ve to purchase to earn a prize. And as a rule, if I’ve to make use of mind energy, I’ll overlook in regards to the loyalty program altogether.
But there’s additionally a commerce off in making your loyalty program too easy as properly.
For instance, if you happen to reward factors based mostly on a buyer’s “total number of purchases”, a client could purposely break up a big buy right into a collection of tiny ones simply to gamify their rewards.
Bottom line, hold your loyalty program easy, honest and make it simple for a buyer to determine what they should do to get free stuff.
Tier Based Loyalty Program
Tier based mostly loyalty applications are largely utilized by the airline trade however could also be relevant to your on-line retailer relying on the forms of merchandise you promote.
Whenever a buyer takes a selected variety of actions, they’re positioned right into a particular tier that entitles them to extra advantages and particular pricing.
For instance, my favourite cruise firm, Royal Caribbean, rewards you with particular lifetime advantages when you’ve earned sufficient cruise factors.
Knowing that each cruise I e book contributes to “lifetime benefits” closely influences me to e book with Royal Caribbean over another cruise firm.
The primary benefit of a tier based mostly system over a factors based mostly one is that the advantages are long run versus a one off reward.
In normal, tiered applications work higher for greater value level purchases like flights, inns, cruises and companies that require a big dedication.
But any ecommerce enterprise that gives companies along with bodily merchandise could profit from a tiered system.
Fee Based Loyalty Program
A price based mostly loyalty program works greatest if you have already got a properly established enterprise with a lot of prospects.
Both Amazon and Costco are most likely essentially the most well-known ecommerce corporations that supply a price based mostly program.
In return for a one time or annual price, prospects get entry to particular reductions, gives or quick, free transport.
I can communicate from expertise that each Costco’s and Amazon’s price based mostly applications work amazingly properly. And my spouse and I fortunately pay their annual charges as a result of we are able to’t dwell with out both service.
But that being stated, a price based mostly loyalty program will most likely not be a very good match for many smaller ecommerce companies.
However, if you happen to can establish a set of things that generally trigger a buyer to not make a purchase order, you may bundle these elements right into a particular program and cost a flat price that addresses them.
Amazon’s prime membership is an ideal instance. Amazon found that the majority of their prospects had been abandoning their cart due to transport so that they bundled free 2 day transport as a part of their program.
A price based mostly system is greatest for companies that get frequent, repeat gross sales. Basically, any consumable product falls below this standards and if you happen to can bundle a fascinating service for a small price, then you definately’ve principally acquired that buyer for all times.
How To Implement A Customer Loyalty Program For An Ecommerce Store On The Cheap
If you’ve made it this far, you most likely agree that buyer loyalty applications are superior. But how do you really implement one in your ecommerce enterprise?
First off, it’s a must to determine which loyalty program kind you wish to create. Then, it’s a must to work out your standards.
Here had been the first objectives for my loyalty program implementation.
- Must Be 100% Automated – I by no means wish to manually replace factors or take care of prospects. A laptop has to deal with all the work.
- Must Be Inexpensive – I don’t wish to pay hundreds of dollars per thirty days for a turnkey answer.
- Must Be Straightforward To Manage – I don’t wish to dedicate a lot time to sustaining this system in any respect. It has to only work and be self managed.
With these objectives in thoughts, I opted for a Facebook Messenger chatbot answer utilizing ManyChat. What’s cool about ManyChat is that it could actually retailer knowledge about your buyer.
For instance, I can use a chatbot to trace what number of occasions a buyer has made a purchase order. I can use a chatbot to automate the rewards redemption course of. I can use a chatbot to deal with rewards factors.
Everything is completed by a pc which makes a chatbot ideally suited:)
An Overview Of My Loyalty Program Chatbot
Below is a diagram of my buyer loyalty program chatbot which I’ll clarify in small items as a result of there are a number of shifting components.
Below is a excessive degree overview of how this system is structured.
- When a buyer first indicators up, they’re given a 50 level join bonus
- Every greenback spent is the same as one level. The first reward is earned at 200 factors.
- Whenever a buyer makes a purchase order, they’re supplied with a particular hyperlink that’s used to replace their level whole
- Customers can test their level whole or redeem a reward by clicking on the identical hyperlink
- If a buyer desires to redeem a reward, they’re given a particular coupon code and a particular hyperlink to take a look at with that product
- Once a redemption is made, the factors are mechanically deducted from their account.
- All rewards factors and orders a saved on the ManyChat platform
Let’s break this down into steps
Step 1: The Signup Process
Using ManyChat terminology, I first arrange the Facebook Messenger chatbot utilizing a Messenger Ref URL. Basically, this can be a fancy method of claiming buyer should click on on a hyperlink to get began.
After they click on on the hyperlink, they’re requested a easy query whether or not they’re right here to be a part of the rewards program. Once they click on sure, they’ll now be messaged about something inside 24 hours as per Facebook’s phrases of service.
At this level, if the shopper will not be part of this system but, they’re requested to enter of their e mail. This is necessary as a result of e mail is the first method that’s used to trace orders.
In reality, all prospects MUST use this e mail when inserting orders on the shop or else they are going to NOT get credit score for the sale.
Once they join, they’re tagged as a loyalty program member, rewarded 50 free bonus factors and the e-mail is saved in ManyChat’s database.
Step 2: Redeeming Points
What’s cool about ManyChat is that you would be able to append parameters to the Facebook Messenger URL. Essentially, this lets you cross knowledge to ManyChat that you need to use along with your chatbot.
For my on-line retailer implementation, the buyer order quantity is handed to ManyChat together with the shopper redemption hyperlink as proven beneath.
This order quantity is then saved within the “Order Number” area inside ManyChat.
If the shopper is a member of the loyalty program, ManyChat then sends the shopper e mail deal with together with the order quantity to my web site to confirm that it’s actually a legitimate order.
If the order quantity matches the e-mail deal with, then my web site returns the order worth again to ManyChat which is then used to replace the loyalty factors whole.
Following the diagram above, these actions are taken if the order is legitimate.
- The variety of loyalty factors is incremented by the final order worth
- The order quantity is appended to the checklist of redeemed orders in ManyChat. This checklist is used to make it possible for the shopper doesn’t attempt to redeem the identical order twice for factors.
- The buyer is thanked for his or her order, given their new level whole, and enticed to see what prizes they’ll redeem
Step three: Collecting Prizes
Redeeming factors for prizes is 100% self service.
When a buyer has amassed sufficient factors to redeem a free prize, they merely click on on the prize as proven within the circulate beneath.
If the shopper has sufficient factors for the prize, then ManyChat pings my web site and a coupon code is returned to the shopper together with directions on how you can redeem their prize.
To hold issues easy, I created separate product listings for these prizes and the coupons which might be given can solely be redeemed for these precise merchandise.
Coupons additionally mechanically expire inside 30 days. Right now, I’m not providing free transport for these prizes.
We’ll see how this performs out however the aim is to entice prospects to store for different objects along with their free rewards after they determine to redeem their factors.
Deciding On Your Loyalty Prizes
The aim of any loyalty program is to reward your buyer for buying at your retailer and make them tremendous followers of your organization.
But in the case of selecting your prizes, you wish to give the shopper sufficient incentive to proceed buying with out costing your online business some huge cash.
My spouse and I debated for a very long time what to supply as rewards and in the end we selected to give away our greatest promoting merchandise INSTEAD of money or reductions as prizes.
By offering fastened merchandise as prizes, we are able to decide and select our highest margin merchandise to offer away which prices us much less cash general.
If we had been to offer away reward playing cards or proportion reductions, we might don’t have any management over what a buyer buys which might negatively have an effect on our backside line.
In phrases of deciding on level thresholds for prizes, we selected values based mostly on our typical common order worth. After all, we would like a buyer to be rewarded for each third or 4th buy from our retailer.
Because our AOV is about $60, we selected 200 factors for the primary tier of prizes however that is topic to alter based mostly on experimentation.
How To Keep Customers Interested In Your Loyalty Program
The great thing about this loyalty program is that it’s 100% automated and fully palms off. However, the danger of this a lot automation is that prospects could overlook about your program altogether.
And after they overlook, it implies that they received’t be enticed to spend extra to earn extra prizes.
As a end result, it’s in your greatest pursuits to remind your prospects about your loyalty program every so often and the very best half is that this may be performed inside ManyChat.
Because ManyChat helps e mail, you may have ManyChat mechanically e mail your prospects at set intervals to remind them of their level totals and entice them to buy once more.
In a method, your rewards program can act like a win again marketing campaign WITHOUT freely giving any reductions.
For my loyalty program, I e mail my prospects each 28 days to remind them store extra to earn extra factors.
Here’s what you need to embrace in your e mail.
- The variety of factors at present in your account
- What rewards your buyer is eligible for
- How many factors they want for his or her subsequent prize
- A snapshot of how a lot free stuff they’ve received to this point
Once once more, all of those emails could be totally automated. And relying on what you promote, it is sensible to remind your buyer to come back again and store at the very least each 60 days.
If you wish to make this tactic more practical, you may even reward prospects further bonus factors as a part of a sale as a substitute of standard reductions.
I fall for this tactic all the time with my bank card at any time when I get bonus factors for my purchases. These methods work.
Simplifying The Loyalty Program Implementation
If you wish to copy my precise loyalty program implementation, chances are you’ll must do some primary coding.
But with just a few simplifications, you will get by with out requiring a developer.
For instance, as a substitute of pinging your web site for order values, you may merely increment a buyer’s level whole by 1 for each buy made.
Instead of mechanically producing a coupon code, you may have the shopper e mail you their redemptions and course of their rewards manually.
But with only a tiny little bit of coding (that any primary programmer can deal with), you may implement a totally automated system that runs by itself!
Loyalty Program Implementation Costs
All informed, the loyalty program that I applied for my ecommerce retailer was kind of free if do you not depend the price of ManyChat. After all, I used to be already paying for ManyChat for normal Facebook Messenger broadcasts.
Meanwhile, my loyalty program permits me to simply section out my greatest prospects and deal with them like royalty.
If I wish to ship out a particular promotion to my most frequent consumers, I can simply section my checklist based mostly on loyalty factors.
Meanwhile, the loyalty program entices prospects to come again and store once more. As Bain and firm acknowledged above, all it takes is a small proportion of shoppers to come back again in an effort to see huge good points.
I’ll report again in a 12 months and give you quantitative outcomes of my program. Good luck!