As inflationary pressures continue to build, businesses must find ways to maintain customer loyalty. Incentives will be a critical tool for maintaining customer loyalty, as rising prices can cause customers to shift their purchasing habits — potentially lowering demand for certain products.
However, companies need to be thoughtful how they structure incentives, targeting more price-sensitive customers rather than taking the margin hit across the board. While loyalty programs can be a great way to encourage customers to stick with your company, digital offers or discounts can also help keep customers coming back for more. Not only are digital incentives more cost-effective, but customers prefer them.
By using the right incentives, businesses can offset the adverse effects of inflation and stabilize demand, maintaining profit levels while keeping customers happy.
Did you know investing in back-office innovation can also help companies protect their margins, and weather inflationary impacts? Read more here.