6 Strategies to Reward Your Loyal Customers

  • Julia

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  • Last updated: January 2, 2023
  • 6 Minutes
6 Strategies to Reward Your Loyal Customers

Did you know that each new customer costs you five times more than retaining an existing one? Since existing customers trust you, there is a 60-70% potential for repeated purchases. But you have only a 5-20% chance with a new visitor.

That’s why so many businesses focus on retaining customers. And the best time to grow your sales with a new loyalty program or reward strategies is the end of the year.

In this article, the reader will find creative ideas as we’ve collected the best tips for eCommerce to create and improve your loyal customer reward strategies.

Make them feel special

For instance, offer your loyal customers the opportunity to be the first who try new perks, products, access sales, or discount coupons. This approach is popular among tech companies too. They invite users to join product beta releases.

By the way, you can offer discount coupons right in the chat to reward particular customers personally. The Intercom platform enables you to do so thanks to its integration with Voucherify. While this is indeed a feature-rich platform, it should be taken into account that Intercom’s pricing is sky-high and quite unpredictable.

In any case, people usually become a part of such an exclusive club via a subscription to an email newsletter or getting access to other benefits and parts of the e-store after log-in in.

That’s a psychological trick that moves visitors down the lead generation funnel. Here is an example from Gilt Noir Loyalty Program:

Gilt Noir Loyalty Program

Early access is one of the exclusive perks the Gilt Insider program offers its customers. Image source.

This online store of accessories and clothing is famous for its time-limited sales available for its most loyal customers. There are two criteria to enter this club:

  • the total value of past purchases,
  • duration of the membership.
  • Some firms offer customers premium membership in this club as an excuse for a company mistake, such as a client’s data breach on the brand how-to video.

    In addition to small gifts, each member receives an early access privilege to preview all products and sales. This early access privilege is a premium benefit that makes customers feel unique and valued.

    Feature a customer of the week/month/year

    Everyone likes to be recognized for their contributions. Your customers are no different.
    Suppose there is someone who purchases in your store more often than others. Or maybe you have a customer who recommends your store on socials regularly.

    Feature such a consumer on the main page of your website, socials, or email digest. To enhance the effect of a title, you provide an exclusive discount.
    Here is an excellent example of this approach from the Poplar Home Waterproofing store:

     Poplar Home Waterproofing stor

    One of the posts highlights a customer of the month on brand socials. Image source.
    Each month they highlight top customers on Instagram. In addition to a photo, they wrote a word of thanks for Melanie’s support.

    As a result, other customers can be excited to take this honored place next time. Use this method to make more buzz around your brand, increase following on socials, and get more customers involved in your business’s success.

    The buy X, get X free program

    This tried, and true approach is also called Buy One, Get One, when a customer gets something for free after spending a specified amount of money. Just look how Supplement Xpress, a nutritional supplements store, uses this strategy to give customers a great deal.

    BOGO program

    The BOGO program in action. Image source.
    When this store visitors buy any supplement at the total price, they get one more for free. Please pay attention to the cost of $34.99: the free item also has it. Thus, at the final step, consumers can see how much they saved with this deal.

    But products for free aren’t the only benefit you can put on BOGO offers. Experiment with this when purchasing a set number of products, customers get:

  • discount on the following product (best for hardware, beauty, and clothing industries);
  • free samples (use it to introduce a new product);
  • choice of gifts (popular in the beauty field).
  • Thus, you can increase your sales of unpopular items and show appreciation for top customers.

    Points Program

    It’s all about post-purchase flow. In this program, your store visitors will get points for every purchase. Then, they can exchange it for discounts, goods from your store, vouchers, etc. For this, you need to provide people with personal accounts or an app to track how many points they have.

    Points programs are well-known among restaurants, cafeterias, and retail environments.

    For instance, Chipotle gives customers 10 points for every $1 spent in the restaurant, in the app, or online.

    Chipotle

    Chipotle points program description.
    When customers collect enough points, they can get free food or merchandise, among other rewards.

    Exclusive perks Chipotle offers

    Exclusive perks Chipotle offers.
    In addition, Chipotle app users get early access to new menu items and merch, birthday presents, and free Chips & Guac after signing up.

    It implies consumers pay one time or buy a subscription and then get access to their rewards: early admission, exclusive offers, discounts, etc. The last element – rewards – is the success key.

    When you know the pain points of your target audience, you can use them as a great benefit to justify the membership cost.

    For example, Swanson Vitamins clients can forget to buy dietary supplements in time. With that knowledge in mind, the store created the My Auto Delivery loyalty program in addition to regular discounts and free shipping.

     Swanson paid membership program

    Description of the Swanson paid membership program.

    Subscribers of this program pay upfront, set up the desired frequency of vitamins purchase, and the system sends them customized packages of supplements and vitamins automatically.

    In such a way, consumers save time and never run out of supplements.

    Value-based loyalty program

    This program is based on a deep connection with consumers beyond financial relationships. Thus, it isn’t about rewarding customers but about donating a percentage of purchases to welfare or charity, which has a substantially higher value. That’s why businesses tend to combine it with other loyalty programs.

    Sephora is one of those companies. In 2020, this beauty store provided its clients with an opportunity to donate their reward points to the National Black Justice Coalition. It caused an immediate public reaction on socials:

    Sephora customer

    The Sephora customer post. Image source.
    Thus, when Sephora customers have enough points to spend, among other options, they can donate it in cash equivalent to the National Black Justice Coalition.

    To sum up

    Still trying to figure out where to start? Relevance is key to a loyalty program’s success. It’s essential to customize your program to serve your customers and your business goals. So choose wisely. Here is a short strategy to help you.

    1. Consider the company values you want to highlight.
    2. Set goals beyond sales increase: capture data, test a new product, improve reputation, etc.
    3. Know your customers’ interests and pain points to offer them the best customer loyalty benefit. Ask what they want from a rewards program in a survey or poll.
    4. Choose the base of your loyalty program strategy: free or paid membership.
    5. Will it have loyalty levels or not?
    6. What customer activities do you want to reward: the number of purchases, membership time, and money spent?
    7. Pick a standout name for your program.

    Time to practice. Good luck!

    6 Strategies to Reward Your Loyal Customers

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