Tony O'Connor, Loyalty Expert
Tony O'Connor Loyalty Expert
7 minute Read • 02 Jul 2021

5 conditions that ensure a successful Loyalty Program

Creating and running a successful loyalty program is more difficult than you might think. There are a lot of factors to take into consideration - some of which you can control - and some of which you can’t.

The decisions begin with the program itself. What rewards should you offer, and how many points should they require? 

Then you have your existing customers. Which rewards will they respond best to? And is it possible to create a reward list that pleases everyone?

How about new customers? Will your program offer enough to persuade them to sign-up? And then become regular customers?

Do you have a webshop or website? If so, how are you going to create an omni-channel experience?

While some of these questions may seem a little bit daunting, you will be happy to hear that this blog has all of the answers to these questions - and more.

It’s definitely worth keeping in mind that all companies and loyalty programs are different - but if you address these 5 conditions you’re going to give your loyalty program every chance.

Condition 1 - Does your loyalty program provide value? 

Value is an incredibly powerful word for every business - and your loyalty program needs to make customers feel like they are getting better value by joining. This can either be achieved by providing them with rewards that they actually want - or by making them feel like they are being rewarded with every visit.

You also need to recognise the fact that customers expect a certain level of rewards - and if you offer them less, they’re not going to be impressed.

For example - if you offer customers a 1% discount on every 10th purchase customers might not only find that poor value - they might find it insulting. In these instances, a loyalty program could have the opposite effect and actually drive your customers to the competition. 

The important thing to remember is that loyalty programs are based on reciprocity. The customer chooses your business - and you reward that decision with gifts or discounts. 

These kinds of programs can only work if both parties are happy with the arrangement. 

 

Condition 2 - How convenient is your loyalty program? 

While value is important for loyalty programs - so is convenience. 

You have to make it easy for customers to join your program - and easy for them to use. 

Right from the initial sign-up, you should be making decisions that allow users to join as quickly and effortlessly as possible. Not only will this increase the number of customers who join - but it sets their expectations for the rest of the program. If registersing is quick and pleasant - then they will expect the same from the rest of the program.

If the sign-up process involves scanning codes, filling in 25 fields of data and 5 verification emails - the people will quickly decide it’s not worth their trouble. 

One possible tactic to consider here is to start-off requesting only the bare minimum of information, then slowly add to your data fields over time, by requesting customers to provide their date-of-birth, product preferences, etc.

This way you keep the program as simple as possible, while also collecting data you can use to make your communication more personalized and your rewards more relevant. 

 

Condition 3 - Is your program simple enough? 

Simplicity is vital in all forms of communication - and it’s different to convenience. 

Convenience makes it easy for people to perform actions. Simplicity, on the other hand, makes everything easy to understand.

The biggest mistake marketers make when it comes to simplicity is that they forget that they spend every day thinking about their loyalty program - but customers have 10,000 other things occupying their mind on a day-to-day basis. 

A loyalty program may seem straightforward to someone who has spent 3 months working on it - but to a customer who has a shopping list containing 12 different things from 5 shops, it might be incredibly confusing.

The secret here is to make all communications as clear as possible. Use bullet points when necessary, and use instructions which take your users through the process in short, numbered steps.

 

Condition 4 - Is your program exciting? 

Part of the enjoyment of loyalty programs is how the excitement builds. Even with old-fashioned stamp-cards, where customers received a free coffee after they purchased ten coffees, the excitement would build with every purchase.

After the 9th coffee was bought, the customer would think ‘The next coffee I get here will be free’. Then, when the magic day actually rolls around, the customer not only gets to enjoy the free coffee, but they also have a sense of achievement - and a sense of gratitude - all of which helps build a stronger emotional bond with the business.

Today, with digital loyalty platforms, apps and customers all having smart-phones we have many more opportunities to help build and create the feeling of excitement.

One of the most interesting ways to use digital technology is to employ gamification techniques. This could include anything from setting customers quests and challenges to complete over a certain amount of time - or even regarding customers for actions like writing reviews and engaging with social media accounts.

Companies can also use this technique to delight customers with unexpected treats and rewards. Not only does this help boost the visibility of your loyalty program, but it makes your customers feel special and valued. 

 

Condition 5 - Is your loyalty program shareable?

Loyalty programs are great tools for customer retention - however they can also be used as a customer acquisition tool too. And the secret to this is utilizing social media.

One of the most popular ways to achieve this is to create rewards for your customers that are experiential - rather than offering discounts or products.

An example of this might be a restaurant offering customers the chance to dine at the ‘Chef’s Table’ - where they receive a bespoke tasting menu. Chances are your customers will want to share this experience online - meaning that the restaurant will be seen by all of their friends and family. 

Every company has different customers and different opportunities - but it’s worth really putting some thought into creating rewards that give customers special experiences. 

 

Does your loyalty program meet all 5 conditions? 

The easiest way to meet these conditions is not starting your own bespoke loyalty program - but joining a digital loyalty platform.

A digital loyalty platform allows you to create a loyalty program that provides you with all of the benefits you’re looking for:

  • Complete control over rules and rewards
  • Automatic data collection
  • A detailed customer database
  • Professional marketing campaigns
  • The ability to create monthly newsletters.

 

However instead of having to hire consultants, agencies, designers and staff - you simply pay a small monthly subscription for the software that lets you do all of this yourself.

If you’re looking to start a loyalty program - or upgrade your existing program to something that matches the 5 conditions above, arrange a chat with one of our loyalty experts by clicking here



7 minute Read
Ronald Bongers, Business developer
Ronald Bongers Business developer
7 minute Read
Tony O'Connor, Loyalty Expert
Tony O'Connor Loyalty Expert
7 minute Read
Hylke Reidsma, Loyalty Expert
Hylke Reidsma Loyalty Expert

Start your own loyalty program in just 5 minutes