Jun 14, 2018

6 Key Steps to Structuring a Successful Rewards Program

This article originally appeared on MINDBODY.

A rewards program can be a great tool to retain clients and bring in new business—but you have to structure the program well or it can cause problems. For example, you can’t give too much away because the program will become too expensive, but you can’t give too little or your customers will lose interest. That’s why we created this quick guide for structuring a rewards program that will set your business up for success.

  1. 1. Use a Point System

    The tried and true point accumulation system works where activities like spending money or attending classes earns points, and those points are redeemed for prizes. There’s a reason the major airlines and credit card reward programs are set up this way. This structure is easy for customers to understand and incentivizes them to engage more deeply with your business.

  2. 2. Calculate Your Earning Velocity

    The average earn velocity tells you how many points each customer earns per month on average across all of the activities you reward. For example, for a yoga studio it might take into account the average number of classes attended each month, amount spent on retail, appointments or workshops attended and referrals. Let’s say for example that this equates to 30 points per month. You wouldn’t want a free class to cost 1000 points in this scenario because it would take the average customer almost 3 years to redeem a free class. But you wouldn’t want it to take only 50 points to redeem a free class either or the average student would get a free class every other month. You can contact us at Perkville to get a spreadsheet to help you calculate the average earn velocity.

  3. 3. Make a Reward Attainable within Three to Six Months

    Your customers should be able to earn at least one reward within a 3 to 6 month timeframe. Otherwise, they will lose interest in your program, and it won’t be effective. Ideally this reward would be small or inexpensive. For example, a health club may offer a smoothie or discount on retail. In the example above, it would mean at least one reward would cost between 90 and 180 points.

  4. 4. Award Big for Referrals

    A successful referral is often worth hundreds of dollars to health and wellness businesses so ensuring that the points given for a referral are appropriate (not too cheap) is important to keep clients interested in referring friends. As a good rule of thumb, reward your referrals enough such that they can redeem a high value reward if they bring you a new customer.

  5. 5. Use Your Rewards to Cross Sell

    Entice customers to try different services or products at your business by cross selling. For example, if you’re a salon, use retail as the rewards so more customers give your hair products a try. Or if you’re a gym, make personal training a reward so that more customers try PT. Cross selling not only encourages customers to try out offerings they may have not otherwise, but also adds variety to your rewards program.

  6. 6. Add Partner Rewards to Your Program

    You don’t want the rewards you offer with your program to put you out of business, but at the same time, variety is important. A good way to give customers great value rewards while also keeping the rewards financially feasible is to partner with other nearby complimentary companies. For example, if you’re a spa, perhaps partner with a local salon who may offer your customers a reward such as 50% off their first haircut. Or the local coffee shop might be willing to offer your customers a free coffee reward to drive traffic to their store.

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Apr 4, 2018

234 New Clients in Two Months! How Greg Bott is Taking ZFit to the Next Level

We spoke with Greg Bott about his journey to owning Z Fit Studio. This boutique studio in Fenton, MO is known for its non-intimidating and fun workout atmosphere. Greg is the new owner who has not only maintained that charm, but is also spearheading tremendous growth at the business. Here is his story.

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Mar 5, 2018

Wade Anderson Shares How He Increased Revenue 149% in One Year at Orange Shoe Personal Fitness

We spoke with franchise owner Wade Anderson of Orange Shoe Personal Fitness about how he grew two locations. Orange Shoe Personal Fitness-  Lakeview and Andersonville have increased revenue 149% and 33.8% respectively in the last year alone! Keep reading to learn more about Wade’s story.

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Jan 2, 2018

Darrin Yee and Bren Schader of Envision Sport Share Their Secrets to Great Hiring and Growing a Business

Recently we spoke with Darrin Yee, CEO at Envision Sport Physical Therapy & Pilates, and Bren Schader, the Director of Sales and Marketing, about how they grew the business. Darrin and Bren went from patients of the clinic to the people running and growing it. Keep reading to learn more about their story and their advice for other business owners.

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Sep 28, 2017

Learn How Terri Fry Grew Retail to 20% of Overall Sales at Her Yoga Studio

We spoke with Terri Fry of The Hot Yoga Factory about how she grew retail to 20% of overall sales at her yoga studio in Chelmsford, Massachusetts.

Terri’s success landed her a speaker spot at MINDBODY BOLD this year.

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Sep 25, 2017

Kelly Kostecki Shares the Unique Way Her Yoga Studio Stands Out from the Competition

Om On Yoga in Richmond, VA is not just a yoga studio, it’s an adventure based, experience company. Owner Kelly Kostecki retains clients and stands out from the competition by crafting unique, unforgettable experiences for her members.

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Sep 21, 2017

Shala Harris Shares Marketing Strategies that Grew Her Fitness Studio By 50% Every Year

Recently, We spoke with YuBalance owner, Shala Harris, about how she started her neighborhood fitness studio. Read on to learn:

  • Her strategy for getting new members
  • How she differentiated YuBalance from other studios
  • How the YuBalance team uses Perkville to increase customer retention

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Sep 11, 2017

Michelle Steed Talks About Starting a New Business and How Perkville is Helping her Barre Studio Grow

Recently we chatted with Michelle Steed about her transition from school teacher for 25  years to the owner of an Xtend Barre Studio franchise in Huntsville, Alabama.

Check out her advice for other new business owners, and how Perkville is helping her stay ahead of the competition.

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Sep 4, 2017

Leana Rudish Shares Strategies for Growth at Her Cardio Barre Studio

When Leana Rudish speaks about Cardio Barre Eagle Rock, her passion for the business shows. This passion is what led her to become a successful studio owner with a growing client base

Check out Leana’s story to learn how she has grown Cardio Barre Eagle Rock.

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Aug 16, 2017

Lisa DeSico-Boyd Shares How She Grew Membership 300% at Her Personal Training Studio

 We spoke with Lisa DeSico-Boyd, owner of Achieve Fitness Studio, about her success in the personal training business. Lisa increased client retention rates and grew membership by 300% in just four years.

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