The conversation about customer rewards or loyalty programs in indoor tanning business is very much different than in most every other industry. Most retail business use loyalty programs – punch cards, point systems, etc. – solely as a means to incentivize you not to turn to their competitors. Whereas, because of seasonality and EFT-centered business models, indoor tanning businesses should be more focused on lengthening the duration of memberships.
Of course you want to keep your clients from visiting competitor salons, but there are other ways to accomplish that feat. Your primary goal for instituting a loyalty program should be to maintain memberships through the slow season. That’s why now is the best time to get your program in place. When new clients start memberships in December, they will be exposed to the program from the start and experience the benefits for several months before they’re likely to even consider cancelling.
An engaging rewards program that offers a gradual increase in benefits can be a more effective and efficient way to maintain memberships than other options like freezing accounts or applying start-up or cancellation fees. Offering freebies and discounting products will generally be worth the improved EFT draws, and you’re likely to make some dollars back via volume sales due to discounts for loyal clients.
Some of the most successful loyalty programs in the industry provide tiered benefits that increase based on length of sustained membership. Discounts, upgrades and freebies continue to increase, but if the membership lapses and the client returns later, they start back at the beginning. If the client has a chance to earn a 30 percent lotion discount for the life of their membership after 12 months, and they plan to tan again next year, they’ll definitely have to think twice about whether cancelling the membership for a few months will actually save them money in the long term.