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Client clubs in loyalty marketing

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Client clubs

A client club is a more or less selective club combining the “best” customers (or even sometimes potential clients) of a company to dedicate to them specific offers or event. This is a retention (loyalty) tool.

Indeed, the client club is part of a comprehensive approach to loyalty. It is a central target processing tool based on the concept of privileges. It has a real or virtual structure, and is created by a company where all or part of the customers can become members to enjoy special benefits, according to the general or specific conditions determined by the company.

The establishment of a client club is often very expensive because it requires regular operation and deployment of many loyalty tools: call centers, personalized direct mail, welcome gifts, magazines and events reserved for members … This also explains why in some cases a fee is required.

Challenges and objectives of the client clubs

The main objective of the client club is a loyalty of consumers to a brand or a company developing both feelings of belonging and privileges.

When a company decides to set up a club, it is first to create added value for consumers who wish to enroll. This allows both to stand against competition, although in some sectors such as telephony all operators now have a club, but also to differentiate from traditional chats or forums that are now the community ” basic” tools.

In some cases, the club can be an extension of offers that are already in the traditional economy (eg telephone operators) or can be exclusive to online club members.

Creating of a club allows a company to highlight both the image carrier services such as previews or VIP events, and more traditional services such as contests or tests. A club can either be hosted on the company site on which it depends, or have a separate existence with a website fully dedicated to the club.

In creating value for both parties, it allows the construction of a profitable “win/win” commercial relationship, the company must then grow to facilitate trade in the long term.

The main objectives of the clubs are of several types:

  • Developing the commercial potential of best customers.
  • Strengthen the universe of the brand.
  • Federating high-potential customers.
  • Identify the reasons for satisfaction or dissatisfaction.
  • Enrich the database, and refine the segmentation.
  • Optimizing knowledge of customers.
  • Increase the potential limitation of members.
  • Test new concepts for products or services.

Thus, the clubs have the advantage of inducing different types of profitability for the company, the main being:

  • A commercial profitability, with sales and margins targets.
  • Profitability related to communication and development of the brand.
  • Profitability in terms of marketing to optimize customer knowledge.
  • An experimental profitability afforded by direct or constant access to representative customers by their demonstrated commitment to the brand.

Characteristics of client clubs

Three types of clubs

In the universe of client clubs, there are three types of clubs:

  • The “fictive” club: the members are not interconnected. The company maintains a designated user database of members in terms of their volume of consumption. This is for example the clubs developed by the airlines to reward and encourage loyalty. The club remains virtual and its members are linked together by the company or the brand.
  • The club with real connections between the members: The company is a real link between the club members who themselves are then interconnected. The favorable effects of sense of belonging can then be obtained. The club is based on a real connection between members and the company or the brand, which implies a membership (free or paid). Collectors clubs are a good example.
  • The club built around a cult brand. In this logic, people who belong are similar, hence the term increasingly used by communities.

Club membership

Often, to join a client club must register. Registration details differ among clubs. The first major difference is the level of free, some clubs offer a totally free registration while others charge registration, which implies that the services offered are more interesting than in the free clubs. The registration fee is variable and proportional to the benefits offered and is reasonable but not to discourage consumers.

Other clubs have implemented automatic enrollment upon purchase of a product.

But the registration to be free or paid, personal information are most needed time to validate the registration. From simple email to the complete details through the centers of interest, some sites are created solid databases through their club.

Finally, access to certain clubs can be reserved for certain categories of people (children, women …) or professions.

Constitution of clubs

The constitution of a client club needs technical support for a precise segmentation to determine who would be included in the club and those to oust.

This step is a very important step because the mere creation of a border between members and others give the first a stronger sense of recognition.

To achieve this segmentation the company must determine what criteria will be used for identifying of future members. The temptation is strong to retain only customers whose consumption is more important, however, mostly companies include in their criteria the potential consumers, too. Others prefer simply to identify consumers naturally attached to the brand or company.

Among the important criteria for determining those with strong chances of entering the group, is the behavior of individuals. Indeed, often, the club serves as a test group and ensures the expectations and satisfaction of customer needs. It can test market developments, consumption patterns, habits … In fact, an effective approach is to select the profiles with higher ability to deliver a prospective vision of tomorrow’s market. Then the company can push the scheme further and engage members in developing new offers. But this is still little used by businesses.

Currently, most clubs meet the most related consumers to the brand. So the members are real lawyers for the brand, able to convey the image and values. The circle of influence of the latter is certainly quite difficult to evaluate. However, they have the will to deliver positive messages, which is an asset in a world where word of mouth marketing has become a formidable tool.

But other companies, by choice, prefer to open widely their club. This is particularly the case of those that lack information about their customers and want to take the opportunity to deepen their knowledge. The clubs then become a way of ensuring the collection of data necessary to develop direct marketing campaigns, for example.

In addition, meetings encourage bilateral dialogue between companies and their customers and prospects. Through the meetings, customers are also asked to share their experiences with each other, their views … With the web that grows, the lines move and even clubs evolve and dematerialize. Nothing prohibits them to enroll in a virtual dimension.

Anyway, club membership must be completely free. To make people to do so, companies rely on the content. This has to be sufficiently unifying and attractive to arouse interest.

The push forward and animation of clubs

The push forward

Companies setting up a client club communicate this most often from the home page of their website in order to attract maximum consumers to their club.

Sites can also use some tools such as pop ups to showcase their latest promotional offers.

Companies also report on the number of subscribers to their club. These figures create value somehow, because if there will be more people, more will be interesting thr offers (in theory, because everyone will certainly not be satisfied), and non-members will want to enroll.

The animation

To energize a club and build customer loyalty, each support plays a very specific role. Whether the membership card, newsletter, website, gifts or points system which provides gifts … All of these tools make it possible to live the club and diversify its communication.

The animation of clubs and events in different ways:

  • The membership card (it can store purchases of members and the points obtained for each of them, it then allows the company to offer to these members products and servuces tailored to their needs and make them enjoy benefits).
  • The newsletter (periodically present new products or services, a newsletter is a mirror which reflects the consumer’s image. It is not a simple additional promotional nature, but closer consumer means of communication, and richer than a sales brochure).
  • The dedicated website (allows members to be active and to have easy access to the club).
  • Gifts, reductions, personalized offers … (this adds value to the customer and allows to be grateful to the members).

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