"Spend until it hurts" - this principle, neuroscientists believe, guides a person in the process of their spending. That is, it is not the lack of funds that stops us and restrains us from buying, but the anxiety that we experience when parting with money. With a low level of anxiety, we are ready to spend without restrictions, and with a high level - on the contrary, even with significant savings, we will deny ourselves everything. Loyalty programs work to reduce anxiety to help maximize sales.
Irina Khomutova, managing partner of the consulting company Khomutova & Partners, one of the leading Russian experts in the field of behavioral marketing, personalized service and the development of emotional intelligence of personnel, talks about the most effective programs.
Increase the percentage
Mathematics is difficult. The brain does not know how to quickly determine which trade is better. For him, the number 50% looks more attractive than 35%, even if mathematically it is less profitable. This phenomenon is called baseline neglect. Basically, we look at a number without paying attention to what it refers to.
“What will have the most impact on the patient? Price reduction by 25%? Or "giving 50% more bonuses"? - says Irina Khomutova. - Functionally, both offers represent the same discount level, subject to partial settlement in bonuses for future services. However, according to our observations, medical services with a 50% cashback offer are sold 71% more than with a 35% discount, although the second option is more profitable for the patient. "
Therefore, the recommendation of specialists is to try to build the promotion of the clinic using the highest percentage that we can afford. The phrases - “70% more bonuses” and “settle 100% of your bonuses” - can provide an additional advantage in driving sales.
“The value of cumulative discounts and bonuses is overestimated by patients. And this must be used, - continues Irina. - In my practice, I always strive to reorient the clinics with which we cooperate, from a discount incentive system to a progressive accumulative bonus system. This approach gives more opportunities to offer maximum percentages (70-90%), which we cannot often give in discounts, and on the other hand, it will always stimulate the patient to repeat requests in order to calculate the bonuses accumulated by him. "
Benefits of a progressive system
The progressive system has a mutual benefit - the patient can see the trajectory of increasing his privileges and increasing personal discounts with the accumulation of certain budgets of funds spent in the clinic. And for dentistry, it is an additional tool to stimulate future sales. With each visit, the patient gets closer to the offers that are more beneficial for him, and the clinic can individually spur his motivation.
“So, if a patient is“ lost ”for some time, we can always return him by sending a message about how many bonuses he already has in his account,” emphasizes Irina Khomutova, “and what we will give you if he comes to reception up to a certain date. By the way, the accumulated bonuses, which are summed up with the general discounts, have a stunning effect in terms of stimulating spontaneous sales, since it seems to the patient that he received the most favorable conditions. In fact, he will pay more than he planned, once again accumulate bonuses and return to us for new services. "
Privileges in exchange for loyalty
The goal of the privilege program is to build patient adherence. When choosing dentists and the client will choose a clinic in which he receives personalized service. This mechanism is important to gain an advantage over direct competitors with identical services.
“In our experience,” continues Irina, “the use of an extensive dynamic loyalty program simultaneously solves five problems:
- It allows you to collect an up-to-date and manageable client base with detailed information for each patient, including data about his relatives (potential patients of the clinic) based on the questionnaires collected during the issuance of cards and through further tracking of the client activity of each patient in the following areas: seasonality, frequency of visits, average bill, the services received, the preferences of the patient himself and his relatives, etc .;
- Reduces the return period of patients by 30% thanks to the system of progressive accumulation of bonuses. Provides the ability to manage sales, encouraging patients to return visits at certain periods, days of the week, time of day thanks to the system of dynamic bonuses;
- Reduces the percentage of outflow of patients to a minimum of 2-5%;
- Saves the advertising budget for attracting new patients up to 50%;
- Increases the recommendation activity of patients who have special privileges and gifts from the clinic by 2,5 times.
Emotional brand attachment
The loyalty program provides for a wide range of communications with the target audience, which forms emotional attachment to the brand. Patients appreciate the special attention and gifts from clinics where they spend large sums.
“Patients take qualified medical care for granted,” argues Irina Khomutova, a leading expert in behavioral marketing, “while special services, gifts and attention provoke recommendatory activity.”
The privilege program assumes a set of preferences for clients: a single bonus card, private events, special offers, gifts for the holidays, individual services and much more.
“We recommend providing a comprehensive system for the effective functioning of the loyalty program,” explains Irina Khomutova, managing partner of the consulting company Khomutova & Partners.
- Issue cumulative cards of different categories to all patients who have used any of the clinic's services;
- Use a bonus accumulation system with a progressive approach;
- Accumulate bonuses from the first service provided for any amount;
- When calculating with bonuses, enter stimulating conditions for calculating up to 100% of the check amount for certain categories of services;
- Introduce the concept of VIP and encourage patients to achieve this status through the additional services relying on this category (concierge service, private events, double bonuses and gifts). "
New patient costs 10 times more
The cost of compensating for the churn of patients and their negative impact on the reputation of the clinic significantly exceeds the cost of their retention, and therefore the focus of marketing changes from the acquisition of customers to their retention.
“Dentists developing relationship marketing are less sensitive to market changes, competitors' promotional programs and seasonal fluctuations in demand,” concludes Irina Khomutova. “The core of an effective strategy is a personalized service and loyalty program that complements the core service with competitive advantages, and the priority is to establish strong relationships with patients and stimulate their adherence.”
Trust and formed bonds reduce the uncertainty and vulnerability of a patient who values a relationship with a proven clinic. This bond is the psychological, emotional, economic, or physical bond that ties the parties together. The strength of this connection determines the brand loyalty of patients.
Source: magazine "Innovations and Practices"