Affluent shoppers value loyalty and gift card programs
August 28, 2013

Investing in a sophisticated loyalty and gift card program may not only be a good idea for small and midsized businesses, it may actually be a vital way to increase sales opportunities among wealthy consumers. When SMBs are able to convert new customers into repeat shoppers, the business can see improvements in revenue, customer satisfaction and even referrals. If those consumers are affluent, SMBs may experience a significant boosts in sales. According to a new study, wealthier shoppers value loyalty programs just as much as less affluent consumers.

Many high-income customers participate in loyalty programs
A survey of wealthy consumers by the Luxury Institute found the majority of shoppers earning at least $150,000 a year belong to a loyalty initiative. Seventy-two percent of high-income consumers said they participate in a type of loyalty program, especially if the initiatives are connected to carrying plastic. Affluent shoppers tend to pay for products with credit or gift cards at the point of sale, and SMBs that accept card payments may want to take advantage of this connection between plastic and loyalty programs by promoting them together.

The study also found wealthy women were more likely to use a retailer's loyalty program than men, with more men saying they were active with hotel and airline reward programs. Affluent shoppers weren't as likely to participate in luxury brand rewards programs as in those provided by smaller businesses.

Milton Pedraza, CEO for the Luxury Institute, said loyalty programs are a vital link between the customer and the company and can be of great value to the business.

"Loyalty Programs combined seamlessly with one-to-one customer relationship building can be highly effective in driving conversion and retention while making data collection easier," Pedraza said.

This close connection between the shopper and the SMB is important for driving sales. In a piece for Entrepreneur magazine, Kim Gordon, an expert in SMB markets, suggested SMBs optimize their loyalty program's value by creating personalized interactions with individual customers. SMBs can do this by showing consumers they can pay with their preferred purchasing method.

Loyalty and gift card initiatives are important for driving sales, and SMBs shouldn't assume affluent customers are not interested in participating in the program. The majority of shoppers value loyalty programs, and SMBs may want to encourage each customer to enroll in the initiative.

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