11 Customer Loyalty Program Ideas and Examples

The idea of customer loyalty programs has been around for decades, but the benefits of a well-executed program still resonate with companies today. Customer loyalty offers can provide immediate financial and brand value by building long-lasting relationships between customers and brands. These are 11 great examples to get you started in developing your own customer loyalty program strategy.

The “customer loyalty program examples” is a list of 11 customer loyalty programs that are currently in use. The examples include how the programs work, what they offer and their success rate.

When it comes to purchasing in-person and online, consumers have plenty of alternatives, and keeping them loyal to your company is no simple chore. Customer loyalty programs that promote involvement and loyalty with your company are critical to your financial success.

You may manually execute your customer loyalty program, but we suggest adopting customer loyalty software to guarantee that your program can expand, remain structured, and develop with new features to compete with major brand loyalty programs.

Here are 11 ideas for customer loyalty programs that have been proved to work:

1. Get to Know Your Clients

It’s crucial to know your target market and the methods that will appeal to them before you start designing your customer loyalty program. For example, the demography that buys at a baby boutique would definitely love to receive a free bottle with a $75 purchase, but this same incentive system would not work to build loyalty among the market that shops at outdoor stores.

The success of your loyalty program is critical. Consumers who engage in high-performing loyalty programs (programs that have favorably affected respondents’ habits and overall satisfaction) are 80% more likely to pick the brand over rivals and twice as likely to suggest it to their friends.

When creating a client loyalty program, keep your target demographic and brand in mind. Ask yourself if your concept is something that clients would appreciate whenever you brainstorm ideas or develop new methods. Will they be enticed to return? Is there anything I can do to make my concept more consistent with the brand?

Using reporting features inside a customer loyalty program, such as TapMango, is another way to test new ideas and filter out techniques that don’t work. Use A/B testing and real-time data to track the performance of your loyalty program over time so you can make changes and develop the most successful program for your company.

TapMango provides high-level reporting and consumer insights to aid in the improvement of your customer loyalty program. (Image courtesy of TapMango)

Kaldi’s Coffee in Action

Kaldi’s is a St. Louis-based local coffee shop chain. Kaldi’s realized its target demographic was the neighborhood regular since it was located near college campuses and in walkable areas. This consumer buys little items often and is either on the road or setting up camp at a café table for the day.

Kaldi’s launched a punch card like loyalty program that rewarded frequent customers with a free coffee after 10 transactions in an attempt to reach out to this client. They also received a Kaldi’s mug after they completed three punch cards, which they could use for their daily cup. Not only that, but personnel would go out of their way to learn the names of loyalty cup holders and their frequent orders.

This campaign was a huge success, encouraging frequent visits and brand loyalty while also cultivating a feeling of community.

2. Maintain Brand Consistency in Your Program

Building on the previous point, you should make sure that your loyalty program is in line with your brand to provide your clients a consistent experience. This isn’t just for show; displaying your brand consistently across all platforms may boost sales by as much as 23%. Furthermore, strong branding in your loyalty program will help clients remember your company and make it more recognized in the future.

When it comes to branding your customer loyalty program, make sure the language you use is consistent with your brand voice, the visuals you use match your brand image, and any methods you adopt are consistent with your overall branding scheme.

WeWoreWhat in Action

WeWoreWhat is a rapidly expanding apparel company that places a strong premium on branding as part of its customer loyalty program. Its image is that of a fashionable metropolitan girl who is constantly on the move and always trendy. She’s been dubbed “the girl boss” by some.

WeWoreWhat addresses all of its customers as “babe,” sends sarcastic messages, and has a loyalty program that rewards big, infrequent purchases. For the WeWoreWhat brand, it all makes sense. The program’s tone is in keeping with its city girl style, and the incentives system encourages large purchases for its occasional deliveries.

Creating a unified brand experience can assist you in increasing sales and cultivating loyalty. (Image courtesy of Affiliate Eye)

3. Eliminate paper use

Our environment is getting more digital, and people’s choices are evolving in lockstep with it. Customers nowadays, more than ever, do not want to carry a physical loyalty card around with them. Rather, today’s buyer expects a wholly digital experience, and physical parts are sometimes irritating or off-putting.

What if I told you that

If coupons were accessible online, 63 percent of shoppers would use them more often when shopping.

Creating a digital loyalty program is simple if you use loyalty program software, since most software tracks client points and awards and allows you to access purchase histories and other information. In addition, most software alternatives have an integrated customer portal that allows users to access their loyalty member accounts and monitor their status online through an app or website.

Wherever feasible, try to avoid using paper and instead opt for digital choices. You may also send text or email notifications instead of giving out fliers, use a digital points monitoring system instead of punch cards, and distribute digital coupons instead of paper ones. Whatever you can do to make life easy for your consumers will help you recruit new members to your loyalty program and expand your client base.

Safeway in Action

Safeway’s digital loyalty program is a perfect illustration of this. Safeway, unlike other supermarkets, does not utilize physical cards; instead, a staff registers you on their computer. Then you supply your phone number each time you check out. This brings up your account and allows you to access your rewards.

Customers do not have to keep track of anything or fill out any paperwork as part of this service. Rather, joining Safeway’s loyalty program is simple, and you won’t have to work hard to keep getting bargains and prizes.

Customers want paperless, digital programs, and they will make your life simpler as well. (Photo credit: Coupon in the News)

4. To entice new members, provide discounts on first-time purchases.

If a new shop provides a discount or special, 80 percent of consumers believe they are more likely to make a first-time buy. As a result, offer new customers a first-time purchase discount to assist them overcome the fear of trying a new company and encourage a sale.

To entice new members to join your loyalty program, you might provide a discount for doing so. For example, in my store, we gave new VIP members $10 off their first VIP purchase. This was a major component in attracting individuals to our program and converting one-time consumers into long-term clients.

First-time deals, particularly for online companies, are a key aspect of obtaining new clients. Online shoppers can’t touch or feel the items, and it’s difficult to know what to anticipate from an unknown merchant. This leads to increased purchasing hesitancy and a larger need to develop incentives for individuals to test your store.

Popup adverts are often used by online companies to promote their customer loyalty programs. (Image courtesy of Shopify)

Pampelone in action

Pampelone is an online women’s apparel store that specializes in high-end dresses and knits for ladies. Pampelone aims to overcome first-time purchase anxiety with a $30 discount for new consumers, despite the fact that its products are expensive and there is no opportunity for people to see them personally.

This is a wise decision. The magnitude of the discount corresponds to the price point, thereby increasing first-time purchases and establishing a solid client base.

5. Recognize and reward referrals to expand your customer base

A referral program is another approach you may utilize in your customer loyalty program. This is a word-of-mouth (WOM) marketing method in which existing customers are rewarded for referring their friends to your business. Not only does this technique increase total traffic, but referred consumers are 18 percent more loyal, have a 16 percent greater lifetime value, and spend 13.2 percent more than non-referred customers.

Custom links that are attached to client accounts are one option to launch a referral scheme. Customers may copy the personalized link from their account and share it with their friends, and you can monitor and reward them depending on what happens on that link. Custom connections may be obtained via a referral service or through customer loyalty software.

You may also offer clients a discount voucher to share with their friends. When their friends use their vouchers, they get a discount. For example, you might provide consumers a sharable 20% off code, and when their code is used, they would get a 20% off coupon as well.

Customers should be rewarded for referring their friends to your shop via a referral program. (Photo courtesy of Lightspeed)

As part of your referral campaign, you may (and should) leverage social media. You may have competitions in which participants must tag their friends to be eligible to win, or you can build personalized links to your social media accounts that consumers can share with their friends. Use social media to expand your consumer base. It’s one of the finest strategies to build your brand and reach new customers.

Glossier in Action

Glossier was a modest cosmetics and skincare business that was only getting started a few years ago. It developed quickly, however, and is today one of the most successful independent cosmetic companies on the market, thanks in large part to its simple, user-friendly referral scheme.

Anyone who refers and converts a buyer using a personalised link will get a 20% discount ticket from Glossier. This, along with its positioning as a youthful, girl’s girl business, spread the word like wildfire as girls shared their links and received their prizes.

6. Use Points to Encourage Spending

A points program is another technique to increase client participation in your customer loyalty program. Points systems are a wonderful approach to enhance customer spending and build brand loyalty, since 75 percent of customers prefer organizations that give incentives.

You grant points that may be redeemed for prizes in a points program (e.g., discounts, gift cards, and special offers). What you reward points for, on the other hand, varies from company to company, depending on which technique works best. Here are a few options for structuring your loyalty points program:

• A spend-based program awards points depending on the amount of money spent. Companies who wish to promote greater purchases should use this sort of points scheme.
• Visit-Based Program: This rewards program awards points based on the number of client transactions and is ideal for companies that depend on modest, frequent purchases.
• Loyalty Activities Program: When reward points are based on your specified loyalty actions, this is referred to as a loyalty actions program. Commenting on a social media post, evaluating your purchases, shopping on a discount day, or purchasing more than two things are examples of these behaviors. You describe the behaviors you want to see from your clients that will benefit your business the most. You may also use incentives and awards to entice consumers to take action.

Nordstrom in Action

Nordstrom offers a well-known loyalty program called “the Nordy Club,” which is based on a points system. Customers of the Nordy Club get points depending on how much money they spend, and as they accumulate more points, they receive cashback and unique access. It’s a terrific example of a points program that not only uses money-back benefits to develop its program, but also exclusivity.

Shoppers in Nordstrom’s Nordy Club receive points for every purchase and may progress through the levels to win greater incentives.

What if I told you that

They discovered in the book Marketing Metrics that organizations had a 60 percent to 70 percent likelihood of selling to an existing client, but only a 5 percent to 20% chance of selling to a new prospect.

7. Use Tiered Loyalty Programs to Create a Sense of Exclusivity

The contemporary consumer values exclusivity more than ever, with 94 percent of Americans indicating they would take advantage of an exclusive deal if provided with one. Create a tiered membership structure in your loyalty program to leverage on this demand for exclusivity.

Customers’ loyalty status rises as they interact and spend more at your company, providing them access to unique discounts and offers (similar to The Nordy Club example above). Customers are encouraged to return to your store and spend money so that their status and offers might improve and become more exclusive.

Tip: Make sure you promote the benefits of higher membership levels so that consumers are aware of what they are losing out on at the lower levels and are encouraged to purchase more.

Tiered programs typically feature at least three levels and are based on a points system. In other words, your membership tier is determined by the quantity of points you have. This simplifies the membership process and makes tracking and implementation simpler.

Sephora in action

The “Beauty Insider Program” is a popular tiered reward program offered by Sephora, a prominent beauty shop. Based on their points, users may be classified as an Insider, a Very Important Beauty, or a Rogue.

Members have access to better offers, larger discounts, and special freebies and events as they progress through the ranks. They also receive first access to Sephora’s uncommon discounts and a larger discount. Exclusiveness is used as a weapon in the Beauty Insiders program to promote Sephora’s loyalty program and reward spending.

Sephora makes it a point to inform customers about the deals they might get if they only paid a little more. (Photo courtesy of Sephora)

8. Provide members-only discounts

Offering member-only incentives is one of my favorite strategies to increase interest in your loyalty program. This will not only create a feeling of exclusivity that will encourage individuals to join, but it will also encourage them to spend.

When attempting to convert clients, be sure to promote your member special and emphasize it in all advertising materials. You want folks to know exactly what they’ll receive if they sign up for your program. Furthermore, since they are limited-time deals, you may tailor your discount to encourage spending in a certain region. For example, depending on what you need to move quickly, you may offer discounts on sluggish sellers or hot goods.

Inspyre Boutique in Action

For many years, I operated Inspyre Boutique, a local women’s apparel business in downtown Denver. We had a “VIP program” where you could get access to the “Item of the Month” (IOM) bargain if you were a member. For this promotion, we’d choose a category of items—say, hats, sweaters, or shorts—and give our VIPs 20% off for a month.

The IOM offer was a major incentive for consumers to purchase our reduced merchandise, as well as a selling element for joining our program. When we ran out of IOMs, we held monthly competitions to see which affiliate could sell the most. Overall, it was an excellent loyalty program approach for increasing sales and increasing interest in our program.

9. Increase Engagement by Gamifying Your Loyalty Program

Gamification is the act of bringing game components, such as competition and scoreboards, to places where they aren’t usually seen, such as your loyalty program. Gamification is used to increase engagement and drive revenue.

Gamification is becoming a significant aspect of merchants’ marketing efforts as the world becomes more distracted and harder to engage. In fact, in the next five years, 87 percent of North American merchants expect to employ gamification to engage consumers.

You may gamify your loyalty program in a few different ways:

• VR: Using technology like VR, you can get people to connect with your business in a fun and engaging manner.
• Contests: Prize-based contests increase engagement. Perhaps you conduct a lottery in which every referral counts as an entry, or you give your top monthly point holders a special discount. Use your imagination to encourage individuals with rewards that they care about.
• Prize Wheels: Allow clients to spin a wheel to win various prizes and discounts. You may either make a prize wheel pop-up for your website or have an actual prize wheel installed in your business. In any case, you will undoubtedly enlist the help of others.
• Create a scratch-off game that clients may participate in when they purchase additional things. For example, suppose you include a scratch-off sticker with your big coffees, and if a client gets three of a type, they get a free large drink and pastry of their choice.

throtl in action

Throtl is an ecommerce site for vehicle parts and accessories that employs car giveaway competitions to entice customers to spend and increase engagement. If you pay $10 a month to become a throtl VIP member, you’ll have access to exclusive prizes and incentives, as well as 10 entries into the vehicle lottery. Everyone else gets one entry into the sweepstakes for every $1 they spend. Customers are enticed to spend because of the possibility of winning an automobile.

ten. Use outreach marketing

Reaching out to consumers through text or email is one of the most effective methods to keep them engaged in your loyalty program. Inform your regular customers about impending promotions or discounts, remind them about their points and prizes, inform them about new items or exciting improvements, or provide them with an unique offer.

What if I told you that For every dollar brands invest in email marketing, they receive $42 in return.

Automated loyalty messaging is available in certain loyalty applications, such as Smile.io and Fivestars, where you may set specific triggers and have messages sent out automatically. You might set up a trigger that sends messages to those who haven’t visited your coffee shop in a week, or an email trigger that corresponds to your sale timetable.

Text marketing may help you connect with your consumers. (Image courtesy of Mindbody)

J.ING IN ACTION

J.ING is a modern women’s apparel company that employs SMS outreach to stay in contact with clients and keep them interested in the brand. You must submit your phone number in order to become a J.ING loyalty member and get your 15% off discount code. J.ING then utilizes this information to inform all of its devoted consumers about impending deals, as well as other interesting promotions and collections.

11. Use rewards and limited-time offers to commemorate special occasions.

Offer exceptional discounts to members on their birthdays, special occasions, and anniversaries. These limited-time and event-based promotions are very efficient in enticing customers to buy. Birthday greetings had a 481 percent greater transaction rate than advertising emails, according to research.

To promote events and offers, most loyalty software allows you to send messages and emails. If you want to include a birthday promotion, make sure you’re gathering member birthday information and have a software that allows you to do so. For an automated solution, we recommend Fivestars.

To encourage customers, send out birthday and special occasion discounts. (Image courtesy of Stella and Dot)

bareMinerals in action

bareMinerals is a beauty business that delivers discounts and incentives for most holidays through its loyalty texting and email program, as well as a free birthday present. The cosmetics firm takes advantage of every chance to run event-based limited-time deals and has grown into a profitable business as a result.

Conclusion

Client loyalty programs are an excellent approach to increase customer retention, loyalty, and sales. Depending on your available time and program size, you may opt to implement your program manually or using a software application. Use the ideas listed above to create a program that makes sense for your company and helps you achieve your goals.

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