Customer Loyalty Programmes Gel Well with the Mattress Industry

Customer Loyalty Programmes were started in 1995 and since then it has vectored the mattress industry towards better profits. The industry has seen a slight reduction in sales during lockdown and has bounced back after the lockdown. Loyalty programmes are one of the key factors in keeping customers loyal to the brands during these leaps and bounds. Various loyalty programmes are customized according to the customer needs and few customers feel value additions to the loyalty programmes make them even better.

Customer loyalty programmes are one of the creative marketing tools that convert a new customer to a repeat customer. When a customer makes a purchase, the retailer rewards the customer with a few points that can be redeemed for a future purchase. This marketing tool helps the new customer or the existing customer remain loyal to the product/ company/retailer. According to Deloitte’s recent survey, businesses with loyalty programmes are 88 percent more profitable than their competitors who do not follow the loyalty programme. Some studies show that investing in an existing customer is more viable financially than acquiring a new customer.

customer is loyal, then 86 percent of them recommend the product through word of mouth, 66 percent write a positive review about the good experience and 46 percent of them stay loyal even after a bad experience. Customer loyalty programmes act as a benefactor to such customer loyalty.

Some of the customer loyalty programmes that the mattress industry follows are:

• Referral bonuses of a certain amount of cash back when a mattress is referred to a family or friend.

• Since the mattress is a wellness product, Customer loyalty programmes can be partnered with other products of theirs, giving more prospects to customers.

• A loyalty programme so designed that it gives the first sneak-peak to the latest mattress on the shelf with a 100-day trial or 90-day trial.

• Increasing digital and online customers must also be encouraged. Hence, loyalty programme members must be allowed to easily earn points online too.

Seasonal Customer Loyalty Programmes

“We had a customer loyalty programme last year where we had partnered with HP Petrol Bunk. People who billed an amount of Rs 2000 were given a voucher for Rs 500 from our outlet. People could come and buy anything for that value and we also had lucky draws when those customers approached. The lucky draw coupons were given to those customers and again consisted of Rs.500, Rs.1000 and other vouchers. Since our outlet was closed from March to May due to Corona virus lockdown, we had to open our outlet in May and we were happy that sales started picking up during August one of the reasons is due to the customer loyalty programmes,” says Kumar, Bedding studio retailer from Mysore.

The customer loyalty programme is a very positive marketing tool and it definitely adds to the profit of the outlet. As per company policy, we introduce the customer loyalty program for a span of two to three months, especially during festivals like Deepavali and Dasara (in the months of October to December). We attract customers through other offers during the other time of the year. Offers include the purchase of Rs. 36000 worth of mattress will be rewarded with a cot worth Rs 12000 free,” adds Kumar.

Loyalty Programmes balanced between Online and Offline customers

There are some retailers who believe that customer loyalty programmes work best during times when sales soar up.

“We have customer loyalty programmes only for online business and not for an offline business. It is for a span of three months. The discount offered by the company to the dealer is divided cautiously into online and offline discounts as part of customer loyalty programmes so as to balance the profits. Around 5-10 percent discount is offered through customer loyalty programmes to customers who browse online. Equating to this, a similar offer is offered to the customers offline. In a year we get better profits for only two quarters and the other quarter is very dull. To be specific the first and the third quarter are the ones that fetch better profits. We focus on them majorly. During the second quarter, the business will be dull so we concentrate only on orders from institutions. During September, October, November and December that is during the festival seasons the profit is more and we offer customer loyalty programmes to online customers during this season,” says Hariprasad, Territory Manager for a branded mattress company.

Other than customer loyalty, retailers have other offers to attract customers like giving pillows, bedspreads or comforters, protectors, and blankets free for a mattress purchased. It depends on the company as to what extent the freebies are given. This is a small contribution towards customer satisfaction. This is also an attempt in converting a new customer to a repeat customer adds, Hariprasad.

“Customer loyalty works well for both retailers and customers. Customer loyalty is a very positive aspect and apart from this, manufacturing the mattress according to the customers’ needs and demands also fetches us a repeat customer,” adds another retailer.

Loyalty Programmes brought back customers after the lockdown Even though there was a closed down of shops declared down to lockdown in many cities of India, sales did not stoop down even after the lockdown was lifted.

“We had closed from March end to May due to lockdown. But customers with loyalty programmes were welcomed even after the stores opened and they could redeem it after buying a mattress or a pillow. This has helped sales a bit” adds a retailer Santosh.

Customers also have very good knowledge about the product due to online research. Most of the customers go through the Omnichannel strategy where the customers browse online and finalise the product and come to our shop to feel the product.

People are concentrating more on developing immunity and are careful about the mattress they purchase. Catering to these, there are some retailers who have introduced anti-stress fabric that has been imported from Belgium for the past three-four years and it has been placed on the high-end products, heat absorption technology approved by a certified company called Outlast, a sister concern of NASA. We are offering the same to the customers at a reasonable rate and a high-quality mattress. Such high-end products also let them earn more loyalty points.

There is a loyalty programme in Australia that states that a point earned by a customer through a loyalty programme is donated for a meal to the poor or needy. “Our company have been involved in contributing towards social causes but we do not believe in redeeming from the customer’s points. The MRP remains the same but a very nominal amount of Rs.100 or 200 will be deducted and used for a social cause by the company. The company is doing it from its own interest,” says Territory manager of a renowned mattress company, Hariprasad.

Some companies are offering scratch cards and cashback offers as part of their customer loyalty programs. “We are definitely looking into customer loyalty programmes as they help the outlets achieve more profit,” says a retailer from Bangalore.

Referral-based Loyalty Programmes always a boon

Customer perspectives towards customer loyalty programmes are quite optimistic but with a few value additions. “Four of our relatives including us bought a house recently in Bangalore. My cousin brother bought a mattress for his newly built house and he got a customer loyalty reward to redeem for a pillow. But he did not want to buy the pillow. He transferred the points to me and I got the discount for the mattress I bought for my new house. Along with the mattress we received a pillow and a comforter free. Referral points that come as a part of the customer loyalty programmes are always helpful as they can be transferred to anyone who needs it. Mattresses, fridges and washing machines are luxury products and are bought rarely. Anyway, the customer loyalty programme works better when it is partnered with other fast-moving products like coffee, hospitality, petrol bunks and others. Doing so would encourage customers like us to stay in touch with the retail outlet,” says Sujanashree, a finance expert at IBM.

An after-sales service as a part of a customer loyalty programme enhances the tool better, says one of the customers.

“One of the major concerns, when we purchase a mattress, is regarding the cushioning of the mattress. After a few months or years of usage, the cushioning reduces – making the bed uneven. It creates back pain when we sleep. The pillows we get as freebies during a mattress purchase also get a yellow patch after being used for a certain time. If the customer loyalty programmes are rewarded as discounts for the after-sale service like cushioning of mattresses and cleaning of pillows it would be beneficial. If the customer does not want the cleaning and needs a replacement, the company can replace the old mattress for a discount using the redeemable points,” says Srilakhsmi, a teacher.

ISPF is an industry body which promotes importance of sleep and role of mattress for a Indian consumers. ISPF plays very important role in connecting Indian bedding industry ecosystem. ISPF also acts as bridge between India and international players.