In the retailer’s marketing toolkit, loyalty programs have proven themselves to be one of the most effective strategies for increasing revenue and retaining loyal customers.
The concept of loyalty programs isn’t a novelty; businesses have been leveraging the concept right from the 1700s to identify their best customers and reward them.
Why do businesses make use of loyalty programs? Simple, because they work! Here are a few statistics to prove it –
- It costs five times more to acquire new customers than it does to retain existing ones
- An eCommerce study estimated that by offering customers loyalty programs, eCommerce platforms can increase their average order value by as much as 319%
- A Wirecard survey found that as much as 75% of customers said that they are more likely to make further purchases from a business after receiving an incentive from it
- 71% of customers say loyalty programs are a meaningful part of their brand relationships
Loyalty programs are no easy feat – the right one helps brands retain their customers, help them grow, and give a reason for their customers to come back for repeat purchases.
Before anything else, let’s understand why picking the best customer loyalty platform is beneficial for businesses –
Why are loyalty programs important?
From small mom-and-pop stores to airlines offering massive discounts to more prominent brands to get more volume, businesses spend millions of bucks on developing and implementing gratifying programs.
An average repeat customer spends about 67% more in a month, and 95% of brands say that their loyal customers spend more annually than non-members.
But, it’s simply not enough to send a thank you SMS or email every time a customer purchases from you. Customer loyalty programs help brands tap into the potential of a myriad of benefits.
When businesses understand that 80% of their revenue comes from just 20% of their customers, it’s sufficient to say that loyalty programs are worth the investment.
By leveraging loyalty programs, brands not only improve their revenue but also –
- Increase the customer lifetime value
- Build personal relationships
- Improves customer retention
- Drives customer satisfaction
- Differentiates a brand from its competitors
- Encourages repeat purchases
- Displays customer appreciation
- Causes a substantial boost in word-of-mouth marketing
According to a recent report, about 75% of surveyed customers base their purchasing decisions on their experience.
Businesses with strong loyalty programs grow their revenue 2.5 times faster than their competitors and generate 100-400% higher returns to shareholders.
How to craft a successful loyalty program for your business
Although most loyalty programs work towards retaining customers, increasing customer lifetime value, and improving the revenue of the business, each type of loyalty program works differently.
According to Capgemini, a high percentage of loyalty programs are failing. 53% of customers stated that they abandoned at least one loyalty program last year, insinuating that companies are focusing their efforts on programs that aren’t hitting the mark.
Some of the critical reasons for this are –
- A lack of flexibility, reward relevance, and less than the ideal value from the loyalty program
- Failing to implement the loyalty program on multi-channel platforms seamlessly
- Customer service issues
With multiple types of loyalty programs such as point-based, reward-based, and tier-based programs present, how can a business craft a successful loyalty program?
#1 Make it easy to earn rewards
If customers are taking their time out to enroll in your loyalty program – make it worth their while.
The most popular loyalty program model allows consumers to redeem the accumulated points straightaway with their purchase.
Do not make the loyalty program feel like a three-ring circus with a complicated process. Allow customers to earn points on every purchase they make, which can be redeemed easily to encourage loyalty purchases.
Include a coupon QR Code so customers can access their rewards simply by scanning the QR Code and make a purchase easily.
Here are some easy ways to get your customers to earn points with every purchase –
- Learn about the customers and award them with bonus points on their birthdays and anniversaries
- Reward your customers every time they promote your business on social media or refer a friend
- Welcome a new customer with loyalty points to begin shopping
#2 Provide rewards your customers want
Some customers think loyalty programs are not valuable and are the only means for companies to accumulate data.
Reward programs personalized to your customers’ wants and needs are 58% more likely to encourage loyalty purchases.
The simplest way to encourage this is by rewarding customers with what they want!
This can include –
- Free shipping
- Discount coupons on every purchase
- Exclusive items that are not available for purchase
- Free trial products that may be relevant to the customers
- Discount for future purchases
#3 Make the redemption process easier
A comprehensive and well-thought-out loyalty program will make your customers feel special and increase brand appreciation.
But, having a loyalty program that makes it difficult to redeem or has little to no value to the customer will increase the customer retention rate.
Unredeemed points can be a massive liability to brands, so it is essential to make the redemption process as easy as possible.
This can be in the form of letting customers know that the accumulated points can be redeemed for a purchase, or combined with another form of payment and more to create a seamless redemption experience.
#4 Keep your customers engaged with bonus points
Brands with an impeccable rewards system will result in customers flocking to their doorstep just to experience it.
Think of OnePlus’s initial invite-only purchase model. The brand’s unique purchasing model was so popular that customers and non-customers wanted to buy the smartphone just to be a part of the experience.
This is the perfect example of how brands can boost revenue without having any discounts of any sort.
Markus Albert, Managing Director at EatFirst, says, “You want your name to convey exclusivity and special treatment and communicate to those who join that they are getting real value for their loyalty. Using words like ‘perks’ or ‘deals’ do a good job of this.
Creating a community, ideally through an application that allows people to create profiles, interact with one another, comment, and review, also creates the sense of exclusivity that you want.
I can’t emphasize enough the benefits of creating a multidimensional loyalty program, which is to say, combining points, value, paid, partnered, and tiered program features so that people have something to choose from and so that you are never at a loss for program ideas.”
Here are a few ideas to keep your customers engaged –
- Offer bonus points during the slow time of the month to boost purchase rates
- Throw a surprise sale
- Encourage customers to shop on low traffic days for additional discounts
7 best customer loyalty platforms 2021: Hear directly from customers!
Growave is an all-in-one marketing platform for Shopify brands. It allows them to reach their target audience, convert them, and keep them constantly engaged.
Growave provides a tier-based loyalty and rewards platform that helps brands garner meaningful customer interactions, drive repeat purchases, and transform customers into brand advocates.
Whether it’s rewarding shoppers with every dollar they spend, providing free products and birthday gifts, or establishing a referral program, Growave has you covered.
Polina says, “Growave is an all-in-one marketing platform for Shopify brands that helps them reach, convert and engage their customers. It offers advanced features under one roof that is easily customizable. With a few clicks, you can set up Growave on your store to grow repeat sales and build your customer base.”
Highlights of Growave include –
- Built-in email templates that have flexible customization
- In-built analytics
- Shopify POS and Shopify Plus integration
- Easy onboarding
- Top-rated customer support available 24/7
User rating – 5/5
Pricing – starts at $19 per month
Zinrelo is a modern-day loyalty rewards platform that maximizes repeat sales and per-customer revenue via 360-degree customer engagement, machine learning, and data sciences.
Zinrelo, best suited for retail and eCommerce merchants, helps them engage with their customers in multiple ways and allows them to earn their loyalty to boost repeat purchases.
Zinrelo unlocks customer loyalty across multiple dimensions, including transactional, referral, engagement, and behavioral loyalty.
Andre Oentoro, a customer, says how Zinrelo helped their business.
“Ads help brands to reach a more highly-targeted audience. Brands no longer need to spend hours on organic campaigns just to appeal to uninterested eyeballs. In other words, ads make it much easier for brands to find potential customers who care and are interested in what they offer – so that they can move them down the sales funnel seamlessly.”
Highlights of Zinrelo include –
- Built-in referral program
- Reward tiers
- Flexible rewards
- Multi-lingual support
- Omnichannel program implementation
- 360-degree customer engagement
- Fully customizable dashboard
User ratings – 4.5/5
Pricing – contact the customer support team
Influitive is a point-based reward system that helps businesses build a community with their robust model and enhance customer loyalty with referrals, social media posts, reviews, and more.
Influitive is an industry-leading platform for mobilizing customers and advocates using gamification, content-targeting, and rewards.
The customer loyalty platform helps businesses mobilize much-improved customer advocates by combining powerful tools and expert services via personalized experiences, incentivized learning, and intuitive and fun guided journeys.
Alex Ruddock says, “Influitive helps brands discover, nurture, and mobilize their customers in a fun, gamified, points-based loyalty program. Customers compete with each other to earn points by performing activities like spreading brand awareness on social media, leaving reviews on third-party review sites, and submitting zero-party data that the company can leverage in its CRM and multichannel marketing hubs.”
Highlights of Influitive include –
- Easy integration with CRM, marketing automation, and other apps
- Customer analytics
- Marketing gamification with templates, customization, and mobile apps
- Customizable and branded dashboard
- Seamless community building
User ratings – 4.4/5
Pricing – contact the support team
FiveStars is a unique loyalty program that helps businesses create a rewards program as unique as their business, work directly with their POS system to collect payments, and connect with customers automatically.
FiveStars enables businesses to attract and retain customers by providing them with powerful rewards for their brand loyalty.
The loyalty program provides valuable information that allows users to create the most effective, customized rewards program to encourage them to spend more, resulting in higher income, and much improved ROI.
Highlights of FiveStars include –
- Activity tracking
- CRM integration
- Customer segmentation and dashboard
- Membership management
- Payment fraud prevention
- Loyalty program
User ratings – 4.4/5
Pricing – contact the support team
#5 Loopy Loyalty
Loopy Loyalty is a customer loyalty program software that caters to small businesses. It helps them create digital stamp cards within minutes for Google Pay and Apple Wallet.
Best suited for restaurants, coffee shops, gyms, bars, and more, Loopy Loyalty’s platform helps your brand trigger personalized push messages to your customers, analyze real-time customer insights, and drive loyalty.
Highlights of Loopy Loyalty include –
- Creating digital stamp cards with no design skills or coding required
- An unlimited number of cards
- Location-based messages
- Enables mobile wallets for Google Pay and Apple Wallet
- Real-time customer analytics
User rating – 4.1/5
Pricing – starts at $15 per month
ReferralCandy is a referral program software that helps brands reward customers for referring their friends and family.
The customer loyalty platform helps brands grant rewards automatically, engages customers with fully customizable email campaigns, and receives data-driven insights to measure their referral programs’ effectiveness.
Alicja Olko says, “It helps small businesses generate revenue from repeating customers the same way complicated software help big corporations earn money from customer loyalty. We believe that small, local businesses that we all use every day deserve a simple yet effective solution to boost their earnings from regulars.”
Highlights of ReferralCandy include –
- Customizable reward options
- One-click integrations with multiple eCommerce platforms
- Analytics dashboard to gather insights such as top referrers and view industry benchmarks
- Live chat support
User rating – 4.5/5
Pricing – starts at $49 per month + commission
Formerly known as SweetTooth rewards, Smile.io is a cloud-based, user-friendly loyalty program that follows a point-based reward system for eCommerce businesses of all sizes.
The loyalty platform allows businesses to customize and deploy point-based loyalty programs for their customers to accumulate points for different actions and redeem them for free products, store credit, and discounts.
Smile.io offers three types of loyalty programs – VIP, points, and referrals that can be integrated with several platforms, including Shopify, MailChimp, HubSpot, Privy, and more.
Josh Brown says, “This isn’t just about generating more and more individual referrals. Rather, it’s about bringing a brand’s highly engaged, high-value customers together around a common goal: To spread the good word about your brand to the people who need to hear it — and preparing new customers to get the absolute most out of their experiences with your brand.”
With Smile.io, businesses can assign points to different actions and alert customers with email when their points expire.
Eden Cheng, Founder of WeInvoice, agrees.
She says, “it not only provides a good points program that helps us encourage customers to share our service by rewarding social shares and referrals, but it also provides a good VIP Program that furthers customer engagement by offering additional rewards and status the longer our users keep on using our platform.
Plus, it also gives us control over the platforms that our customers can send referrals from, making it easier to track the referral process as well.”
Highlights of Smile.io include –
- Available in multiple languages
- Seamless integrations with various platforms
- Various types of reward systems for multiple actions
- Easy and intuitive program management
User rating – 3.9/5
Pricing – starts from $59 per month
Find a customer loyalty platform that works for you
Popular brands like Sephora, Starbucks, and Amazon Prime have stellar loyalty programs in place that have helped expand their customer base and increase customer retention rates.
Other brands should hop on the loyalty bandwagon and establish a loyalty program to significantly impact customers, drive repeat purchases, and identify brand advocates.
Now that we’ve explored the best customer loyalty program software, the next step is to pick one that suits your brand best and aligns with its goals.
Try out each platform, explore its features, and select one that keeps the customer in mind, provides them the best incentives, and earns their loyalty.
This blog post was also contributed by Shweta Menon, who works as a Content Marketer at MobStac.
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