This is a guest post from Drew McLellan, CEO and Top Dog at McLellan Marketing Group. See the original post this is adapted from and more like it on his blog.

I’m a fan of loyalty programs… if they’re done right.

TGIFridays
The truth is, most companies aren’t willing to make the reward equal to or worthy of the effort they’re asking from their best customers.

But when you do (when the juice is worth the squeeze) — they can be potent. But what if yours is missing a key ingredient? What if it could have an even more significant impact on your bottom line?

Check out my IowaBiz post below to find out what you might be missing:

Loyalty programs are the rage right now.

As companies fight to get as much of our disposable income as possible — they are wise to create incentives that reward and encourage repeat business. But most of them are missing a key ingredient.

They don’t let their customers share the wealth. Let me show you what I mean.

The McLellans are a big fan of TGIFridays. (Part of that is because the West Des Moines location has the best waitress I’ve ever known…but that’s a different blog post.) So we’re high frequency users of their Give Me More Stripes loyalty card. It’s a simple program. Spend enough money over time and you get e-mailed a coupon for $8 off your next visit.

All well and good. But here’s the part they are missing.

The card holder has to use the $8 coupon. I can’t give it to a friend or co-worker. As the card holder, I must redeem the coupon with the card in tow. I can enjoy the reward… but it doesn’t encourage word of mouth. It doesn’t give me a tool that I can use to help Friday’s grow their business.

On the flip side, we have United Airlines.

Also a McLellan favorite. United lets me rack up frequent flier miles and the more I fly, the higher my status. As a Premiere Executive level member, I get lots of perks. But United is smart enough to let me share those perks. Here are some of my options:

  • I automatically get upgraded to first class if there’s a seat available. So does my flying companion (if I have one).
  • I can check three bags for free. So can my flying companion.
  • I can use my miles to buy tickets or upgrades for anyone I choose.
  • I can donate my miles to Make-A-Wish or other worthy charities.

United lets me share the love.

It gives me ample opportunity to “show them off” or share them with someone else. It makes my loyalty stretch to also influence other people.

Creating a loyalty program is smart. Why not thank your best customers while encouraging them to come back yet again? But, creating a loyalty program that is sharable is brilliant. Not only do you earn the love of your best customers… but you also earn their word of mouth endorsement. And that’s golden!

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About Drew McLellan

Wall Street Journal calls Drew McLellan’s blog, DrewsMarketingMinute.com, "one of the ten blogs every entrepreneur should read." His passion is helping clients discover their story so they can create authentic love affairs with their customers. He's also an author, national speaker, and has owned his own marketing agency in the Midwest since 1995.

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