One of the biggest challenges for most business face today is the retention of their consumers. With the many options currently on the market, the average consumer is spoilt for choice. In fact, did you know that customer acquisition can cost as much as 16 times more than customer retention? What’s more, $1.6 trillion per year is lost by businesses globally when their consumers decide to switch.
So, what is the most optimal way to ensure businesses can retain their customers? The answer is simple and has proved its worth time and again: loyalty programs!
Loyalty programs came into existence when companies realized that the competitive advantage that they once experienced due to product differentiation no longer holds good due to a proliferation of similar looking and “me too” products. In such an environment, having loyal customers became more important and more difficult.
But, do they really work? Here are some statistics to prove the efficiency of loyalty programs:
87% of shoppers reported that they want brands to have loyalty programs
54% of consumers say that they would consider doing more business with a company for loyalty rewards.
46% said that they have already increased the amount of business with a company because it offered loyalty rewards
80% of consumers say that they want a personalized experience and are more likely to do business with a company that offers one.
(Source: https://www.annexcloud.com/blog/loyalty-program-statistics-will-make-rethink-marketing/ )
Based on the statics given above, loyalty programs are no longer just a marketing gimmick, it has become an important source of revenue for a business, much like vending machines, thanks to the digital era and the demands and lifestyle of a ‘modern consumer’.
The vending ecosystem, while extremely beneficial, can become a commodity if not used well. Certain factors as mentioned below has resulted in businesses being hesitant to add loyalty programs to the vending industry:
Lack of consumer experience
It is common knowledge that we are yet to explore and make use of vending machines in the right manner. Currently, vending machines installed are either not working or are too difficult to use. Moreover, most of the machines only accept cash, which doesn’t align with the ‘cashless’ age we are living in. As a result, the eco-system lacks a common platform through which consumer loyalty can be attained and rewarded.
Lack of a 360 Degree View
As most VMOs today use siloed product to track inventory and sales, they cannot analyze consumer preferences, which makes it impossible for them to stock products that are popular with consumers. Hence, the chances of retaining loyal consumers on-board are even lesser.
High Capex Costs
The capex costs, which include buying, maintaining and improving the vending machine is extremely high. Hence, if businesses invest in loyalty programs, they won’t be able to ensure adequate profit margins.
How Vendekin can enable a successful Loyalty Program
Keeping the above in consideration, loyalty programs can only be offered if businesses are successfully able to improve their profit margins and invest in programs while providing quality service thereby urging users to stay loyal to their brand.
Multiple cashless payment options
With cashless payment systems, maintaining track of consumer preferences is becoming easier. Also, consumers can now make transactions without worrying about their money being stuck at the vending machine or worse- failing to get the products despite completing the payment. Vendekin empowers the consumer to use any one of its multiple payment partners to complete the transaction and guarantees an automated refund if the product is not dispensed.
360-degree business overview
Using the Vendekin solution, businesses will be able to have a 360 degree view of all their transactions and stock, hence ensuring they are able to stock the machine with goods popular with consumers, thereby improving consumer satisfaction- thus paving the way for a successful loyalty program which is powered using a single, multi-use platform that is Vendekin! Furthermore, VMOs will be equipped to gain deeper insights into consumer brand preferences thus enabling brands to grow closer to their consumers without significant investment in doing so.
Increased operational efficiency
With Vendekin’s unique and proprietary software, VMOs are informed well in advance about important machine health and inventory stock out scenarios, ensuring that vending machines have a higher uptime. The chances of pilferage reduce substantially since our software enables tracking stock and spare parts from warehouse check out to final consumption.
Vendekin not only provides robust cashless payment options but also increases the operational efficiency of the vending business by providing a 360-degree view of the business through its analytics portal. Thus, with every buck you save, you can invest in programs that will enhance consumer experience & reward their loyalty using a single platform- Vendekin!