Best Practices for Loyalty Programs in Ecommerce

created by Barry Dahl

An effective loyalty strategy will offer the customer plenty of choices  in order to learn more about what their personal preferences are. Providing points based on signing up for a newsletter or sharing your experience on social media can generate a wealth of insights.

1. Should Be About The Customer 

Organizations should manage their loyalty programs around their customers and not their products. Organize your loyalty programs based on around data collected around certain customer segments. Measure the impact of these programs and use them to help improve the loyalty program of the customers in each segment.

2. Create A Simple Earning Structure

It is important that that the earning structure should be easy for your customers to understand. a simple earning structure doesn’t have to be only about points. It should also be about earning badges or collecting buttons. Once they earn enough badges they can earn some type of reward, whether a percentage of money or a product or service.  Consider adding bonus opportunities to earning structures such as trying out new products or reaching a threshold of purchases. Bonus opportunities should be done on a limited basis to keep it fresh and exciting for your customers. Another benefit is it facilitates ongoing customer engagement.

3. Facilitate Brand Engagement

Loyalty programs offer a mix of watching videos, leaving reviews and interaction between other members. The important thing is to make it fun for members and allow your customers the opportunity to interact as well as learn more about your brand. Simple engagement opportunities can be more appealing to certain customers than earning discounts or rewards.

4. Triggered Communication Plan

Have a targeted communication strategy in place for your customers such as a message that a customer receives upon doing something specific such as achieving a higher level or tied to a specific event such as a birthday.  A targeted message to a specific customer carries much more weight than a typical mass market message. By recognizing the achievement or the anniversary of the customer is a great strategy that helps your customers feel that they are important to your brand.

5. Provide Status Updates

Status updates are one of the most effective ways to keep customs engaged in your loyalty strategy. This is similar to the emails we all get from our credit card loyalty programs that present our current points level. Customers will appreciate being updated on the program or the brand. Not only does this keep your brand in their mind, it also leads to some type of interaction where they can redeem rewards or end up making a purchase.