How to Launch a Reward Loyalty Program With Right Efforts?

by Deepak Nautiyal |

How to Launch a Reward Loyalty Program With Right Efforts?

The incredible potential of a customer reward loyalty program in boosting customer retention capabilities and enhancing overall customer lifetime value makes it perfect for implementation in your business. However, launching your own customer loyalty program demands a massive effort in different areas right from program concept generation, educating the customer, to loyalty program performance tracking and much more. Without a solid strategy in place to make these efforts, it’s just not feasible to derive favorable results irrespective of the magnitude of efforts you take for your reward loyalty program launch.

What is a Customer Reward Loyalty Program?

Let’s understand customer loyalty first. A customer’s willingness to continue using a brand’s products/services due to the remarkable experience provided by the brand is referred as customer loyalty.

A customer reward loyalty program is a rewards based system predominantly aimed at luring the loyal customers by offering them perks/rewards that are enticing enough for them to stay with the brand for long.

It can be broadly considered as a well-structured marketing strategy fostering a mutually beneficial relationship for both the brand and customer. While the program initiative comes from the brand’s side, the loyal customers are expected to actively participate in the reward loyalty program in order to make it a real success.

What Makes Customer Reward Loyalty Program Important?


As industry research has clearly revealed that acquiring new customers is much expensive than retaining the existing ones, assigning high value to launching customer loyalty programs becomes enormously important.

Customers as part of the loyalty program spend more money on the brand’s products/services and even refer their friends & family members which enables the brand to gain considerable revenue growth and boost their image.

Loyalty programs help to effectively build repeat business by providing something of real value to the participating customers. The core idea behind such operational programs is to forge a deeper emotional bond with the customer by delivering them more satisfying, memorable experiences.

How to Launch A Reward Loyalty Program: Discussing the Right Effort Required

Leveraging the wide set of business-centric benefits loyalty programs bring along for your brand can be made possible only when you decide to launch one of your own. Nonetheless, there is a massive effort required right from the very start – be it brainstorming about the loyalty program concept, planning about the program cost, deciding on whether to hire a consultant, analyzing loyalty program performance & loyalty KPIs, or any other related strategic activity that can either make or break the reward loyalty program.

Let’s now analyze the multiple game-changing areas where you need to divert considerable efforts while launching your own customer rewards loyalty program in order to make it a success.

1. Program Conceptualization

Ensure setting your goals clearly from the very beginning. Simply designing the program around discounts is more likely to turn it to be a failure than success.

In fact, 77% of transaction based loyalty programs succumb in the first 2 years itself and henceforth pure transaction based loyalty program approach should be avoided.

It’s also not necessary to reinvent the wheel altogether while planning; rather you can take examples of brands already running their loyalty programs successfully. Based on the comparative analysis, you can proceed forward with devising the strategy and proposing program components like branding, incentives & rewards, value-proposition, loyalty currency (coupons, discounts, cash-back & more).

A major effort also goes in computing the costs involved in design, implementation and running the program to ensure the budgetary constraints are not exceeded. Also, attracting the right set of customers and then establishing long-term mutually beneficial relationship with them requires identifying & tracking the most valued customers which further requires analyzing huge volume of customer data.

Identifying customers preferences is the second major area where effort is essentially required as this analysis would yield valuable information to design the loyalty program more efficiently.

2. Program Type and Features to Include

Finalizing the type of loyalty program to offer also requires a major effort as different reward loyalty programs come with varying benefits and downsides that vary from one business to another. Points programs, Tiered programs, Paid programs, Punch programs, Total spending based programs are some of the prominent loyalty programs types to consider in this regard. Moreover, the different features to include in the program is another area to lay special focus upon as the overall impact of your program will depend on how attractive these features are from your customer’s perspective.

3. Program Design & Implementation

In order to design & implement your program, you can consider taking either of the two approaches – DIY or hiring a consultant.

The DIY or “Do It Yourself” approach is suited only if you have the in-house expertise for design & implementation of your rewards loyalty program.

The latter approach is optimal to consider when you lack that expertise. A reputed agency offering services in this domain can assist you to launch your loyalty program without any hassle. Quite evidently, the effort here required is to make the crucial decision of choosing the right agency that relieves you of the hassle of creating and launching your program.

4. Promoting the Loyalty Program

You may have invested considerable effort & time in launching the program; however, what’s the worth of having it when your customers don’t have a clue about it. If you actually aspire to see your program fully operational to drive revenue from it then bringing it to the notice of your customers should be your first priority post launch. Promoting the loyalty program is as important as launching it in the first place.

Depending on which promotion strategy to adopt, you need to make concrete efforts for promotion via social media, email, in-store, messaging or website. Using a mix of all of these strategies to leverage the individual benefits of each individual strategy can also produce optimal results.

5. Making Customers Understand the Need to Enroll

After your loyalty program’s launch and promotion, you still have a long way to go. Once your customers get curious enough to know about how the program works, you again need to come into action. At this stage, the effort will  transform to planning a concrete strategy to convince the customers to enroll.

It must be understood  that presenting simplicity does attract the interested customers while complexity may repel a lot of the interested ones away. Henceforth, presenting your loyalty program rules & conditions with clarity besides citing ample supporting reasons for them to enroll should be your priority. This would though require making the necessary efforts to understand your customer’s behavior and perspective.

6. Analyzing the Loyalty Program Performance

Measuring your loyalty program performance is another area where constant effort would be required. You can consider tracking the enrollment rate to know how many customers have enrolled for your program.

It’s the customer’s active participation in your program that makes it a success and so a lot depends on how clearly you have communicated the benefits of your program to the customers.

Moreover, you can monitor other loyalty KPIs like rewards redemption rate, churn rate, incremental margin etc. to ensure a more comprehensive tracking of loyalty program performance.

Are you looking for some expert assistance on how to launch a reward loyalty program? Feel free to get in touch with our loyalty program experts to receive strategic & technical consultation on launching your program. Call us now!

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