7 Innovative Customer Loyalty Programs (And How to Start Your Own)

Do you want to increase revenue? Do you want to turn one-time customers into repeat buyers? Then invest in a customer loyalty program.

There are many reasons why companies use it, including. One of them is the fact that around 8 out of 10 consumers are more likely to stick with a brand that offers a loyalty program.

Think of it from a customer’s perspective. When you get rewarded for each purchase, your spending behavior will change.

Existing customers are easier to retain than it is to acquire new customers. So you should consider investing in a loyalty program.​

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How to Create Your Customer Loyalty Program

The idea is to reward customers who repeatedly buy or interact with your brand. More spending means more rewards. It can prevent customers from going to your competitors.

These programs offer many benefits, such as:

  • More customer referrals. They can be a source of marketing for you. If they tell a friend or a family member about you, you’ll get more customers.
  • Higher customer retention. Why would they go to a competitor for buying the same item if they can get it at a discount from you?
  • More sales. Many people spend more after joining a loyalty program.

The main thing in creating a customer loyalty program for your business is to:​

Know Your Customer

You must study your customer from different perspectives. Ask yourself:

  • What is the average spending of each customer?
  • What are your most-selling products?
  • How long a customer has stayed with you?
  • What are your profits on their purchases?
  • What is their satisfaction level?
  • Can we improve our business relationship with them in any way?

Prepare your program based on the above questions. You can also learn from surveys, interviews, and monitoring customer comments.

After creating a program, set goals and measure them from time to time. Here are a few examples to inspire you:​

Best Customer Loyalty Program Examples

Here are my 7 picks for the most innovative customer loyalty programs. Study them and use them as an inspiration for your program.

DSW

This brand runs a traditional VIP loyalty program that rewards customers with points for each purchase. It also has ties of rewards that customers can unlock as they spend money.

It doesn’t have any loyalty cards for customers to remember. The online system recognizes a customer using their personal information.

At first glance, it might seem like a problem: if customers don’t have a card, won’t they forget about the program? DSW tackles this problem by reminding customers about their position on the program.

For example, the brand launched an email campaign for this purpose. They use personalized email details to remind people about the program.

Their unique point is the use of hyper-personalized email marketing, the exact opposite of generic email marketing.​

Sephora Beauty Insider

A program with over 25 million loyal members is worth mentioning. Due to its large membership, it drives around 80% of the brand’s annual sales.

It uses a traditional point system to reward customers for each purchase. The difference between this program and others is that members can choose how to use their reward points.

Sephora’s products are expensive. So customers are more likely to get this type of reward points to offset purchase prices. ​

Customer Loyalty Programs

Starbucks Rewards

When Starbucks Rewards was launched, it was not common for brands to use mobile apps for loyalty programs. To get loyalty points, customers must order or pay through this app. Starbucks gave their customers a chance to remove the hassle of punch cards using this method.

This gave the brand access to tons of customer data. By analyzing how people purchase their items, they can create personalized offers.

If a loyalty app is feasible for your brand, create it. Otherwise, rely on a point-of-sale to get the same data.

Amazon Prime

Do you offer the same products as other customers? Don’t worry. Many brands do the same.

Consider Walmart and Amazon. They both sell similar products, so Amazon has created Amazon Prime to be different. It has resulted in Prime members spend an average of four times more than other Amazon customers.

The North Face

The North Face is an apparel and outdoor gear retailer. It lets members earn more rewards through its XPLR Pass program. Customers can get benefits with traditional purchases as well as with unique ways, such as attending events, going to certain locations, or downloading its app.

These rewards give customers access to limited edition collections and collaborations. Some program members can wear test products in public which is considered a big deal. They sponsor trips to far locations as well.

The difference between this program and other generic programs is the curated experience. They focus on creating a strong relationship with customers.

You can learn from their method and create programs based on what excites your customers.

REI Co-op

REI Co-op’s program focuses on creating value for customers. Most brands focus on customers spending more money (at least, this what a customer would think). But REI is different.

They give a lifetime membership for just $20. On top of that, they give huge benefits like 10% back on all purchases.

Apple

Apple shows us that having a loyalty program is not necessary. You create a loyal and dedicated customer base by hooking new customers with your product itself and creating an amazing customer experience. This way, you won’t need to rely on a loyalty program.

Conclusion

A customer loyalty programs are about making customers loyal to your business. The best way to achieve that is to give users value. Learn from today’s examples and get creative.

Do you have a customer loyalty program? What’s your innovative approach? Do let me know in the comments below.​

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