Gamers, Magic players in particular, are a fickle bunch. We are constantly on the lookout for an LGS that will treat us better. Offer us a better deal. Make us feel welcome. The trouble is most store owners fail to create a lasting connection with their customers so when another store opens its doors a good chunk of the community jumps ship.
This is where the idea of membership comes in. Turn your customers into official members of your store’s community and they will be far less likely to disappear. The fact that repeat customers are the core source of income for game and hobby shops makes this strategy even more important than usual. According to Inc. it will cost your business 5 to 10 times to gain a new customer than it will to sell to a previous customer so save yourself some trouble and keep the ones you have coming back.
A codified loyalty program is an excellent way to encourage this repeat behaviour. The way you structure your program is up to you, it’s a good opportunity to get creative and make something interesting but it will most likely fall into a combination of the three main types. Points, Tiers, and Paid.
All the points you can handle
Points accumulation is simple and the benefits are easy to convey. For every X dollars spent in your store the customer receives a corresponding number of points. These points can then be cashed in once they reach a certain threshold and redeemed for items the customer wants. It’s easy to track and simple to see how many goodies are being handed out. This plan has upside for the customer while being effective for the business with the customer making purchases they wouldn’t have otherwise.
Climbing the ladder
This variation usually works in tandem with the points structure above but this time, the customer achieves a certain status when they reach a threshold rather than redeeming their points. The customer becomes a member at the basic level, “Silver” for example, which comes with a few simple yet enticing benefits. As they spend money on your products and services they progress further towards “Gold” and “Platinum” and earn greater rewards. The options for what those rewards can be are limited only by your creativity but they should be tailored to the kind of customers you wish to attract.
Competitive players make up the majority of your customers? Offer discounts on tournament entry or invitations to a special event available only to “Gold” level members. If your customers are more into board games, offer them a special members only discount to a featured board game each week.
Understanding what your customers want is crucial to the success of your loyalty program and your business in general. Once you have that down, take the time to create compelling membership rewards that are in line with your customers priorities. If done right, your customer will always think twice about going elsewhere for their hobby entertainment because they will be invested in you and your community.
It may seem counter intuitive since a loyalty program is supposed to encourage a repeat customer and paying for a membership appears to be a barrier but it can work in certain situations. The value proposition must be clear and compelling immediately. $X upfront (or annually) leads to a standing discount of 10% on a particular product line. After the customer spends a certain amount of money the membership has paid for itself, after that it’s gravy. Alternatively, it can be used to remove a barrier to purchasing that may make customers think twice about buying something like taxes. Buy a membership and never have to worry about taxes again sounds like a pretty decent deal to me.
Whichever form you choose, the core concept of the program is to reward the behaviour that you want to encourage, in most cases that is spending money in your business. Don’t stop there though, it can be used to reward any action you want to see. Offer points for liking your page on Facebook or following your store on Twitter, referring a friend, or being a good community member. You could even reward performance in events if that’s what turns your customer’s crank.
The sleep in special doesn’t have to just be for Grand Prix you know.
No matter the style of program you implement it’s a good idea to give your customer a physical reminder of their membership to your community. Membership cards are a great way to establish your brand and keep your business top of mind for your members. They can also be a sign of status in the case of a tiered loyalty program and give the customer a tangible sense of achievement.
Have you implemented a loyalty program in your business? Leave a comment down below and tell us about what worked and what didn’t. If you haven’t heard already, check out the new Manaverse Podcast where I talk to entrepreneurs in the game business and tease out what makes their stores successful. A new episode is released every Friday, coming up this week is MVP 003 with Jacob Alton Stanley, the owner of Adventurer’s Quarter.