Written by: Mrudul

What Makes a Loyalty Program Successful

Successful businesses know that their success lies in how their customers are treated. Naive business owners do not go out of their way to make their existing customers happy and fulfilled. They will be investing hundreds of thousands of dollars in getting new customers. There is nothing wrong with wanting a pipeline full of qualified

Successful businesses know that their success lies in how their customers are treated. Naive business owners do not go out of their way to make their existing customers happy and fulfilled. They will be investing hundreds of thousands of dollars in getting new customers. There is nothing wrong with wanting a pipeline full of qualified leads, but that shouldn’t come at the cost of your existing customers.

Did you know that it is five times more expensive to onboard a new customer than it is to keep your existing ones happy? A 5% boost in customer retention increases profits anywhere from 25% to 95%. If your existing customers love you and your product, they are more likely to pay a premium, are easy to upsell and cross-sell, and will even recommend you to their friends and family.

As a responsible business owner, you need to offer your existing customers a way to feel valued and give them an incentive for referrals. It is at this point where a loyalty program makes sense. Loyalty programs are one of the best ways to reward your existing customer for giving you business and giving yourself an opportunity to welcome new customers.

Let us see what makes a loyalty program successful:

    1. Emotional Connerction:

      Believe it or not, some brands have been able to tug at their customers’ emotions. The stronger the sense of purpose of the brand, the higher it will drive loyalty. Even a simple gesture in your loyalty program where you give the customer a personal call can be construed as an emotional touch. One of the rewards that you offer could be where customers have the option to redeem their loyalty points towards a charitable cause.

    2. Keeping it simple:

      Your customers are just like you and me. Let’s say you were to offer them a $1000 cash voucher, but the program is complex enough that even understanding the terms becomes difficult, then you can certainly expect them to forego it. It is pivotal that the loyalty campaign is as simple as possible. Reduce the friction as much as possible in understanding the campaign, what needs to be done, how to get the rewards, and so on.

      “Do X, get Y”- This should be the level of simplicity in which your loyalty program is structured.

    3. Provide something of high value:

      The only way to drive your loyalty program’s engagement is to offer them something of value for their time. Your rewards program will not be a success if you don’t apply thought and reasoning to it. Think of it this way, instead of looking at a loyalty program as a way for your customers to show loyalty, use it to show how loyal the business is to its customers. Once you have this attitude, it becomes easy to create a campaign that the customers will love.

      The reward that you offer for your customers, no matter what it is, should motivate and encourage them to spend their time on it. Offer them ways to save money, get free products, cash backs, attractive discounts, coupons, etc.

    4. Creating high engagement:

      The loyalty program should not be about your existing customers spending a few minutes a day doing some random tasks. There will hardly be any involvement when the loyalty program is set up this way. The entire program shouldn’t revolve around doing transactional tasks, but it should be an opportunity to forge a stronger relationship with the customer.

      Getting referrals is just a byproduct of the loyalty program, but the main objective should be to build a strong relationship with the existing customer. Using the right online loyalty program tool will make it worthwhile because you will find more ways to engage the customers. They will even help you to gamify the entire process, thus helping you increase engagement. Simple measures like creating a leaderboard, adding small gifts, and making customers interact with the team will result in a well-rounded experience.

    5. Personalize the campaign:

      If the campaign you run in Germany offers the same rewards to customers in Silicon Valley, then there is an inherent flaw. People are different across geographies, and you need to take that into account while creating a loyalty program. The rewards you offer as a part of the campaign should be in tune with the customers’ likes and dislikes.

      You can even offer hyper-personalized rewards by looking at each customer, their past purchases, products added in the cart, when they browse your products, their typical spend with you, and so on. Using these details, you can send them push notifications, personalized texts, and emails with interesting rewards specific to them.

    6. Multiple loyalty programs:

      Unless there is a grand prize involved that offers an unimaginable amount of cash, it is best that you have a bunch of loyalty programs so that you can target customers who are in different stages of their relationship with your brand.

      To create something like this, you need unique triggers, terms, rewards, etc., to ensure that it is successful for all the customers. By having a varied set of reward programs in place, you will also be able to increase such campaigns’ success rate.

    7. Segmentation of your customers:

      The above point about having multiple loyalty programs is possible when you segment your customers. There are various ways in which you can segment your customers by offering them loyalty programs. A customer who is yet to make a purchase more than once should be put in a different category than someone who has been regularly purchasing from you. Once you are able to box the customers accordingly, you should find appropriate rewards that will elicit interest from them.

    8. Identify your top customers, put extra effort into retaining them, and provide them exactly what they want. Find out customers who are contemplating leaving your service and make extra efforts to stop that from happening with the help of a well-executed loyalty program.

    9. Digitally optimized:

      If there is one area in which you cannot afford to fail during a loyalty program is when it doesn’t work as intended. Imagine the app crashing regularly or if the notifications don’t reach the intended recipient. This can be a nightmare for the customers since this directly affects their experience. It will only reduce their trust in your business. By using an online loyalty program tool that is optimized and technologically-strong, you will be able to avoid these issues.


Loyalty programs are easily one of the most successful ways to engage customers and keep them coming back to you. A poorly implemented loyalty program will do more harm than good; that’s precisely why you need to invest in a tool like 99minds, which can help you create campaigns that will spell success for you.

Brands should remember that a loyalty program’s primary objective should be to create a strong relationship with the existing customer. Getting referrals from the customers as a part of the loyalty program should be considered as a bonus.

Think about how your competitors are making their customers stay. Do not think that loyalty programs are a dime a dozen these days; they are still effective, and if you do it right, the rewards are huge