A loyal customer doesn’t mind paying a higher price. They would rather pay more and ensure the same quality and service they love.
But how do famous brands achieve loyal customers and keep customers coming back regardless of the price or availability?
Happy Customers Are Loyal Customers.
Customer loyalty doesn’t happen overnight. The brands you stick to today were once at the beginning stage too. It takes careful planning and implementation of customer loyalty programs and keeps the service or products your customers love consistent.
In this article, we will take a look at some of the best customer loyalty program ideas as well as the leading loyalty program examples in the world. You can get inspiration and jot down a loyalty program idea for your own business.
Let’s dive in.
Sephora’s Beauty Insider program is extremely popular with more than 25 million loyal members. You might be shocked to know that Sephora’s loyal members make up to %80 of Sephora’s annual sales.
The program is simply a traditional point system where customers earn rewards for each purchase. What’s innovative about this customer loyalty program is that customers get to choose how to use their rewards points.
One of the biggest drawbacks for Sephora customers is the prices. Sephora’s products are a bit pricey. However, the Beauty Insider program provides its members the opportunity to redeem their rewards points for things like:
In short, Sephora keeps customers loyal by offering them the flexibility to choose how they spend pointsand get the products and deals they want without cheapening the perceived value of the products.
The North Face’s XPLR Pass program also offers customers the flexibility to choose how they redeem their rewards points, tailored for its customers’ lifestyles.
Customers earn loyalty points every time they make a purchase or sometimes by attending events, checking in at certain locations, or downloading the North Face app.
When redeeming the rewards, customers can use their points for unique travel experiences such as mountain climbing in Nepal.
Apart from such experiences, The North Face also offers many cool benefits for its members like:
Rather than encouraging customers to spend more and get rewards, The North Face gives out rewards that speak directly to its customers. This kind of unique and curated experiences build up more of an emotional connection with the brand more than standard product discounts.
How you can use this loyalty program idea for your business:
While sponsoring a trip to Nepal can be too much for small businesses, the inspiration here is to know your customers well and create a royalty and rewards program specially tailored to strengthen the bonds in between.
Starbucks Rewards program is perhaps one of the most popular customer loyalty programs in the world.
It is very common these days for retailers to create a mobile app and manage loyalty programs. However, it was a new idea when Starbucks first launched Starbucks Rewards on its mobile app.
In order to collect points (or stars for Starbucks), customers need to buy coffee with the mobile app. So, how does that help Starbucks?
Starbucks achieves a gold mine of customer behavior and preferences data by having so many customers making transactions from the app. Collected customer data include:
All this data enables the brand to offer more relevant perks and communication with the customers.
How you can use this idea for your business:
If creating a mobile app is a doable option for your store, it can be a great opportunity to collect and centralized customer data. Plus, using a royalty reward system along with it keeps loyal customers coming back.
If not, then a capable point-of-sale system can work just as well.
Designer Shoe Warehouse or DSW runs a traditional VIP loyalty program that rewards its customers with points for each purchase as well as ties of rewards that unlock as customers spend more.
There is no loyalty card with DSW’s loyalty program. Instead, its online system recognizes customers by their name, phone number, or payment info. The challenge with such a program is that customers may forget about it altogether.
So, what does DSW do to keep customers engaged in the loyalty program?
Simply, customers who forget about the loyalty program aren’t enticed to spend more and earn more. Additionally, the brand launched an email marketing campaign in 2017 to remind them about the program.
The email campaign included:
How you can use this loyalty program idea for your business:
This campaign was successful because of its level of personalization. Such a loyalty program brings access to loads of customer data. DSW turned the data collection into a marketing tactic by building hyper-personalized emails rather than generic emails that rot in inboxes.
Barnes & Noble also runs one of the loyalty program examples we need to mention. Unlike other customer rewards programs on our list, Barnes & Noble’s loyalty program is a paid program.
Customers who want to join this program and become VIP members pay an annual fee of $25. The effectiveness of a program like this depends on how well you market it to your existing customer base.
If your brand is not recognizable, new customers may not be interested in it, so you need to concentrate on the current customer base. Another important thing is: paid loyalty programs must include exclusive benefits to the members.
Barnes & Noble offers for the paid program:
Don’t forget to nudge your customer a little by using testimonials and social proof so that more can get encouraged to join the program. Make use of social proof popups if you want to draw attention to the loyalty program on your site.
Not all royalty programs are discount-based. Take The Body Shop’s loyalty program, for example; they built stronger relationships with customers when they made animal welfare a part of their program.
You can incorporate a loyalty program based on charity. Customers are more likely to become brand loyalists if you provide mutual value. It also highlights the brand’s stance and values.
E.l.f uses the tiered loyalty system. Tiered loyalty systems focus on the levels of loyalty. In other terms, the more loyal your customers are, the more they buy from you, and the more they earn rewards.
Offering tiers in your loyalty program can help you keep your customers engaged and your brand top of mind. Moreover, tiers include gamification in the process, where members reach higher levels, the more they ‘play’ or purchase.
Here’s the example from E.l.f:
E.l.f’s Beauty Squad Club has three levels:
As the points increase, so does the level, and the more exclusive the rewards get. To encourage more customers to participate in the tier program, including the percentages of each tier, showing how many members have reached it.
You can turn new customers into loyal ones right from the start.
Offer customers a one-time discount to use in their first purchase in exchange for their email addresses. It is one of the most commonly used customer loyalty programs.
This loyalty program will help you not only retain new customers but also strengthen your future marketing activities.
How do you draw their attention to your offer?
With email popup forms! Popups can successfully grab attention and collect emails in exchange for incentives such as discounts.
Take a look at the popup examples of famous brands for inspiration.
Another proven tactic is launching a loyalty points program or points reward program.
Apart from your available offers open to all customers, create special offers that only members can take advantage of by exchanging loyalty points.
The critical point here is to make sure that you offer these exclusively to your loyalty rewards program members and can only be redeemed with points.
It’s also a gamechanger to encourage the members to spend more and gain more loyalty rewards points. We will provide customer loyalty program examples in the following of the article.
Bear with us here because we have a couple of more important customer loyalty program ideas.
How many times have you seen a birthday offer exclusive to you? I assume many times because it is a common method used for customer loyalty programs and one that actually works.
It’s an easy way to keep your brand memorable and intimate. Your tailor-made gift to customers can be in many forms, including:
If you run a tiered program, you can consider giving out goodies to your top customers. They can receive it at the checkout in stores or online for their birthday.
Referrals provide brands to draw in new customers and increase sales. It is a loyalty program that allows your loyal customers to gain reward points by referring your brand and new customers to buy your products at a better price and reward points.
In short, it is a win-win customer loyalty program idea for small businesses to large enterprises.
So, how does it work?
All it takes is sending out a message to your loyalty members asking them to refer you to their family and friends in exchange for an exclusive discount or reward points. The people they refer to can qualify for the same discount once they successfully sign up for the loyalty program.
You don’t have to have a proper loyalty program in place for this to work. Just set up a program that rewards loyal customers with discount codes, coupons, and more.
The most used marketing channels for such customer loyalty programs are email marketing services and new generation popups.
Offering free trials is one of the best customer loyalty program ideas, especially for subscription-based services or software.
The challenge with these kinds of products or services is that people can’t get the first-hand experience with the product before purchasing.
Free trials are a great way to overcome these marketing challenges. If trial customers like your product, they start paying for it, and before you know it, they become loyal.
Bonus point campaign is also a beneficial customer loyalty program.
There are two different ways to execute a bonus campaign:
This kind of customer loyalty program can excite customers to earn more. Make it more effective and profitable by strongly promoting it on social media. Don’t forget to highlight the campaign on your website homepage and product pages as well.
Notice that it’s best to keep this campaign limited and exclusive to members so that they feel special. It can also be a great opportunity to draw more people to your customer rewards program.
Offering customer loyalty programs is beneficial to get more loyal customers and keep your brand top of mind. What you need to remember is you need to provide value to your customers in order to keep them coming back.
What type of loyalty program are you using for your brand? Have you seen its benefits? Leave a comment below; we’d love to hear your opinions. 🙂
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