10 Ways to Improve Your Customer Loyalty Program

A good customer loyalty program never stops evolving. Think about it – consumer behaviour is forever changing, adopting new trends and advancing with technology.

This means that the way in which brands engage with consumers and encourage loyalty should be constantly evolving as well.

Coming up with new customer loyalty program ideas can be tricky after a while; so whether you run your own cosy little hole-in-the-wall coffee shop or you’re the CEO of a huge household name brand, here are some tips on how to improve your loyalty program.

1. Go Digital

Going digital with your loyalty program should be your first priority. Pretty much everything mentioned in this article can only be done if your loyalty program is on a highly interactive digital platform that your loyal customers can engage with; not a piece of plastic, or a paper card with a few holes punched in it.

By digitalising your loyalty program, you make everything much more convenient for both yourself and for the customer. Gone are the days when consumers are happy to carry a dozen paper cards around in their wallet – people want a handy loyalty app on their smartphone that keeps all of their loyalty stamps in one convenient, organised space.

What is a loyalty app? You can learn about our loyalty app here.

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2. Get Personal

If someone signs up to your loyalty program, they are seeking a personal business-customer relationship that makes them feel valued, appreciated and individual.

But how do you make every single customer feel this way when your business is dealing with thousands of customers a day? …Through a well-designed customer loyalty program, that’s how!

Send your new loyalty program member a welcome email when they sign up, and call them by their first name in the subject line. Offer them a free product on their birthday. Check in with them via SMS, email or push notification when they haven’t visited your store or browsed your website for a while, and encourage them to come back with a spontaneous discount.

This might sound like a lot of work (although most of this can be automated with the various digital marketing tools available today), and it’s worth all the effort when you’re executing this next point properly…

3. Use All That Valuable Data You’re Collecting

Remember when we said “go digital” earlier? Well, here’s why. By taking your loyalty program to the digital level, you gain access to a whole bunch of valuable information that you just can’t get from paper or plastic.

For instance, every time a loyalty program member makes a purchase with your business, your system logs the date/time of the transaction, how much was spent, what was bought, and various other pieces of information that allow you to tailor your offers to each individual customer and appeal to their specific needs.

“This customer only buys formal menswear, so why not recommend products like satchel bags, dressy shoes and belts through your customer loyalty program? You could send him push notifications offering a limited-time 30% discount on all collared shirts purchased in-store or online.”

“Meanwhile, your other regular customer consistently buys rings, necklaces, sunglasses and other accessories from your online store, so why not offer her free shipping on all purchases made before Friday?”

4. Turn Your Staff into High-Performing Loyalty Program Advocates

At the risk of sounding cheesy, your staff are on the front-line of the battle to win over your customers. The better equipped your staff are, the easier they’ll find the task of convincing customers to join your loyalty program.

Your staff need to know everything about the program – all the perks, all the features, all the terms and conditions. It’s not a deception; signing up to your loyalty program really is a great idea, so it’s an easy thing to promote as long as your staff are knowledgeable and passionate about the product.

Perhaps you could offer your employees rewards for educating themselves on your loyalty program’s various functions, and keep them on their toes with quizzes and secret shoppers, for instance.

5. Use Your Existing Customers to Attain New Ones

Have you noticed it’s becoming more common for brands to offer discounts or freebies when you sign up a friend? It’s already become commonplace for rideshare apps and food delivery providers.

This emerging trend is an excellent way of encouraging your existing customers to spread the word about your loyalty program, as they are receiving rewards for their advocacy.

Many brands will even offer discounts in exchange for social media sharing – why advertise when you can incentivise your loyalty program members to advertise for you? Offering your loyal customers a discount is still far cheaper than standard advertising costs, and the results are likely to be far greater, considering that people tend to trust peer reviews over traditional advertising.

Offering a small reward upon signup is another fantastic way to turn that “on-the-fence, not-sure-if-I-can-be-bothered-signing-up-right-now” customer into your newest loyalty program member. A small token of appreciation upfront pays dividends down the line when this customer continuously engages with your rewards program and shops with you instead of your competitors.

6. Keep Your Rewards Options Limitless

Why limit your program to a few specific, hand-picked rewards that might only appeal to half of your customers, when you can open up the floodgates and allow them to use their accrued points to redeem whatever rewards they find the most appealing?

Things like Visa Virtual Rewards, MasterCard E-Gift Card, Amazon Gift Cards and GiftCard PASS are changing the game in terms of widening the scope for what rewards you can offer your customers.

Suddenly, one customer can use their accrued rewards points to claim 50% off their next purchase of a L’Oréal product, while another customer can enjoy an extra night’s accommodation for free when they book two nights in any Ibis hotel around the world, for example.

Remember, customers love choice.

7.  Inject Some Fun into Your Program

With features like “Birthday Club”, digital “Scratch & Win” cards and other gamification functions, you can turn your digital loyalty program into a gaming app that customers enjoy engaging with.

For example, our loyalty app offers a Scratch & Win feature where customers run their fingers over their smartphone screens to reveal prizes that can be redeemed in conjunction with their other accumulated rewards points.

As a merchant, you can choose how many Scratch & Win offers are winners (i.e. 1 in 3, 1 in 5, 1 in 10) and what the rewards are – it doesn’t have to be a free car! Just a simple reward is enough to add a thrilling component to your loyalty program that keeps people engaged and interested.

We also offer the capabilities for sending customers automated texts or push notifications on their birthdays that offer a free or discounted product to make them feel valued by your brand.

These small displays of gratitude can make a world of difference to your customers, and help make your loyalty program stand out from the rest. And speaking of sending your customers texts and emails…

8.  Ask Your Customers What They Want – And Give it to Them!

Don’t be afraid to reach out to your customers for feedback. They’ve already signed up to your loyalty program; they expect a bit of correspondence from you.

By offering rewards in exchange for responses to surveys sent out via email (SurveyMonkey and GoogleForms are excellent platforms to use for this) or questions you’ve asked via text, you can get a very clear idea of what your highest-spending customers want from your brand, and minor changes you can make to various areas of the business that will boost customer satisfaction.

People love being heard – if your loyalty program members see that you’ve actually taken their feedback on-board and implemented these changes, you’ll further solidify their loyalty to your brand.

9.  Consider Charging for a “Higher Tier” Premium Loyalty Program

As loyalty programs become more and more common, one could argue that the exclusivity of these programs is being lost. Everyone can enjoy rewards, discounts and upgrades with just a few clicks of a button now.

So with that in mind, many brands have started introducing fee-based loyalty programs that offer premium benefits such as members-only events, first dibs on new products or services, and higher quality rewards in general. More bang for their buck, so to speak.

Of course, this “second tier” premium loyalty program concept isn’t suited for all businesses, but it’s certainly working for the likes of Lululemon and Amazon Prime.

The 2019 Bond Brand Loyalty Report found that, while 43% of consumers are willing to pay a fee to receive enhanced benefits from loyalty programs, that percentage was a full 10% higher among Gen Z and younger Millennials.

10.     Integrate Corporate Social Responsibility (CSR) Into Your Loyalty Program

Consumers are increasingly aware and passionate about giving their business to brands that exercise social responsibility and ethics. And just the same way that you can use your loyalty program to attain new customers through peer endorsements, a well-structured loyalty program can also be used to promote and demonstrate your advocacy of social responsibility.

EB Games is an exceptional example of this – one of the many functions of EB Games’ hugely successful Edge Rewards program is that members can bring in old, unused games and consoles in exchange for a discount on new products… even if these old items weren’t purchased from EB Games.

Customers can also purchase refurbished games and consoles with the same 30-day guarantee but for a much lower price, encouraging recycling and reduction of e-waste.

Another example of Corporate Social Responsibility done right is global fashion giant H&M. While H&M might have only recently launched a customer loyalty program, it has been making headlines for its social responsibility and ethical, sustainable practices for a while now.

In fact, H&M customers have been enjoying discounts since 2013, when the Swedish chain first began inviting consumers to bring used and unwanted clothing into any H&M outlet for 15% off their next purchase as part of the company’s H&M Conscious campaign.

With more than 40,000 tonnes of old clothing collected so far, it’s fair to say this has been a successful endeavour! H&M has also set a 2030 deadline for its own “100% recycled or other sustainably-sourced materials” goal.

So… we hope this gave you some good customer loyalty program ideas?

These 10 ideas can drastically improve your loyalty program for both your brand and your customers. Perhaps you’re already doing a few of the above points, and perhaps some of them could be tweaked and adjusted to work even better for your program.

The key is to remember that there will always be new and better ways to improve your customer loyalty program, and that the faster you manage to keep up with emerging trends in consumer behaviour, the more effective your loyalty program will be.