11 proven loyalty program best practices to retain and reward customers on your Shopify store

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As you enter your favorite eCommerce store, you are greeted with a section that recommends you products based on your previous browsing history and purchases. Such conveniences, rooted in understanding and valuing customers, are at the heart of every successful loyalty program.

What is a customer loyalty program?

A customer loyalty program is a powerful tool businesses use to acquire and retain customers. It offers rewards, incentives, and a variety of perks to do so. The program recognizes and rewards customers who purchase repeatedly from the business. The more the customer buys, the higher the rewards.

This article looks at some of the most proven best practices while building a customer loyalty program.

Proven best practices for your loyalty program

Have clearly outlined goals

The first step toward any marketing campaign is to have clear goals. Each arrow that you pull out of your marketing quiver should have a specific goal attached to it. Write down the list of marketing objectives you have in your mind. It will help you get clarity on how you need to take the next steps.

Ask the right questions

Once you have clearly defined goals, you must ask a bunch of questions internally to further refine it. It will strengthen your loyalty program and give you greater ROI.

  • Let’s look at some of the questions you can ask
  • What kind of customers are we targeting?
  • How long should they be our customers before becoming a part of our loyalty program?
  • What does our loyalty program’s structure look like?
  • What kind of incentives would they be interested in?
  • What channels can we use to rope customers into the program?
  • Which loyalty program software would we be using?
  • What are the features that we are looking for?
  • Which KPIs should we track to understand the program’s efficiency?

Determine the right perks

The most important part of a loyalty program is the perks that customers get. You want to choose the perks or incentives that customers get out of the loyalty program, with careful consideration. When you choose the right perks, it shows customers that you understand what they want. This will increase their loyalty towards your brand, and becomes more than just a transactional relationship.

Make your rewards programs unique

Customers would love to extend their patronage to businesses that offer them perks that are unique and unmatched. That level of differentiator makes the effect of competitors moot. Offer customers a variety of ways to earn points and even more places to redeem them.

Take baby steps

Going all in with a grand plan is best done by enterprises that have millions for marketing campaigns. The average company would do itself a disservice by doing that. A loyalty program is an integral part of your marketing campaign, therefore it is best to scale slowly. Withdrawing your loyalty program because of operational or functional issues will look bad and result in distrust.

Put together a close group of customers or choose a team internally to participate in the program. The pilot will give you how the loyalty program functions and determine whether the value propositon is attractive for those who are a part of it. Take constant feedback during the process and streamline your loyalty program accordingly. Use the feedback to refine the program and close the loop.

Keep it simple

One mistake most businesses end up doing is that they add a variety of fluff to the loyalty program making it complex. If customers find it difficult to understand the terms to earn or redeem points, they will surely lose interest. You want happy loyalty program members, and for this, the simplicity of the program is crucial.

  • Below are a few ways to make your program simple
  • Ensure that the description of the copy is simple and easy to understand
  • Clearly explain what they can expect out of the program
  • Set clear objectives for yourself
  • Establish clear reward policies
  • Make sure the guidelines are consistent across different channels
  • Specify threshold conditions

Leverage customer data

Loyalty programs offer highly useful customer data that customers should leverage. It even tells you about how engaged your customers are with your brand. The data must be thoroughly analyzed to find patterns and trends. It will help you offer the right offers for the loyalty program customers. Based on customer data, you can create personalized loyalty programs and other marketing offers. The ability to leverage customer data efficiently will eventually make your loyalty program even more powerful.

Make a flexible program

Customers love to be associated with a loyalty program that is flexible in terms of how you can earn rewards. Offering only a single channel can be disadvantageous as not everyone is going to prefer it. Being flexible allows you to gain members to the program without discouraging them from it.

Keep refining the value proposition

Your loyalty program’s benefits should keep appealing to your customers. Unfortunately, the same rewards over the years might get boring for most customers, leaving a bitter taste. They should be getting a steady dose of new offers from time to time. Offering attractive rewards results in greater trust and loyalty towards the brand. Conduct regular surveys and leverage tracking tools to find out about the effectiveness of your loyalty program.

Build partnerships

You need to offer high-value rewards that will make the customers keep coming back. Meeting such expectations can be difficult after a point. This is where using different partners for rewards is a beneficial idea. It is a win-win for both parties since it exposes each of them to their respective customers. Partner rewards make the program more exciting and lucrative for everyone involved.

  • Below are some ways to find the right partner
  • Write down a list of potential partners who might be able to offer rewards that your customers will find attractive
  • The business should not be your direct competitor
  • The terms and conditions of the partnership must be clearly spelled out for everyone involved
  • Set a timeline for the partnership
  • Determine the KPIs to see the effectiveness of the partnership

Choosing the right loyalty program software

Without a highly functional loyalty program software, you will not be able to execute your vision accordingly. A software like that of 99minds is a plug-and-play offering that can be set up within a few minutes.

  • What you should look for in a loyalty program software
  • It should be easy to implement within the existing architecture
  • Should have a steep learning curve
  • You should be able to offer the rewards of your choice
  • It should allow for easy integration with third-party apps and systems
  • Should offer reporting and analytics features
  • The program should meet the security and privacy requirements

Wrapping up

The above 11 best practices cover the basics and can be a great starting point for business to retain and reward customers. You can tweak your programs based on the feedback collected and the final results. Keep analyzing the feedback collected to see if customers are loving being a part of the program.

If you are looking for a tool to implement a loyalty program which offers a variety of benefits, you are at the right place. The suite of products at 99minds includes a gift card and coupon solution, referral program, digital wallets, pre-built and automated workflows, and a loyalty program. It can supercharge your marketing objectives and increase your profits too.