Sara Lewis, Diageo GB

The main purpose of any loyalty scheme is to put more cash in the till by giving something of value back to the customer.

Good schemes are an excellent opportunity to increase sales, but if they are developed without clear plans for return on investment, business goals and customer targeting, the cost and administration could outweigh the potential for success.

Before embarking on a loyalty scheme, think clearly about what the purpose of the promotion will be. Are you trying to encourage an extra drink or food purchase, increase customer numbers during quieter periods, attract new customers, or increase spend?

Each of the above will demand a different approach to implement a loyalty scheme successfully, but remember to plan your budget carefully. As a general rule, always think about giving away something that is high cost to the customer, but low cost to you, such as price discounts, trading up in spirit measures, or free drinks or food with an existing purchase. Only give away what you can afford, but bear in mind that it can be of value to take a short-term hit for long-term gain. This is particularly relevant when embarking on a longer promotional schedule, so think about your expected return versus your initial investment.

To get value out of your loyalty scheme, keep your customers' target age in mind. The younger crowd is likelier to respond to "cool" and exciting offers while older customers will be focused on how the scheme can improve their experience in your pub. Don't forget to shout about what you're doing via in-store PoS, outside signage, leaflet drops or advertising, as this can be as effective as the scheme itself.

Finally, you can always try to share the cost with local suppliers and businesses via a joint loyalty scheme, which may provide additional benefits for your customers through added value and excitement. Plus it can be a great way to forge better links for your outlet within the business community.