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Best Ways to Use Loyalty Program to Boost Your eCommerce Growth

Every store owner would dream about achieving a sustainable, long term business with loyal customers. And did you know that you can achieve all of these by implementing a marketing strategy commonly referred to as loyalty programs?

Loyalty is the best deal achieved being in business. It is a dream come true scenario for all kinds of business. And, what are you going to gain as a store owner is even more exciting!

But what are you going to give in return for sustained loyalty?

The 80-20 rule! Have you heard about it?

It is a widely accepted reality by businesses of all types.

So, what does it mean? It means that almost 80% of your revenue is generated by 20% of your customers and those are the loyal ones!

Promote and retain loyalty by acknowledging the twenty percent.

Your goal is to achieve increased sales, why not do it with a customer loyalty program?

If you are a store owner with loyal customers then believe me you are the luckiest. But even if you are working towards achieving a loyal customer base, don’t worry let us discuss how to build a loyal customer base. Go ahead and have a read.

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What is customer loyalty?

The trust invested by your customer in your brand is loyalty. And in customer loyalty “loyalty” refers to how likely are they going to do repeated purchases with you.

How can I measure customer loyalty?

Customer loyalty is measured based upon the repeated purchase frequency over a defined period of time.

Purchase frequency Vs value

There can be obvious confusion while giving customers the loyalty tag. Which will be about classifying customers based on their loyalty.

Hence, who is a loyal customer by definition? Whether it will be a high value one time buyers, customers with purchases summing up to high total order value or repeated buyers. For which there is one clear cut answer which is repeated buyers are called loyal customers.

Introduce a credit system to reward and retain your customers. Credits are digital bonus points given to individual customers. These can be converted into discounts and digital money that can be used for future purchases from you or your collaborator. You can include reward points through the eCommerce email marketing loyalty program. Below are a few examples of eCommerce loyalty rewards.

Why does customer loyalty matter?

Introduce a credit system to reward and retain your customers. Credits are digital bonus points given to individual customers. These can be converted into discounts and digital money that can be used for future purchases from you or your collaborator. You can include reward points through the eCommerce email marketing loyalty program. Below are a few examples of eCommerce loyalty rewards.

  • Loyal customers tend to make repeated purchases.
  • Introduce a credit system to reward and retain your customers. Credits are digital bonus points given to individual customers. These can be converted into discounts and digital money that can be used for future purchases from you or your collaborator. You can include reward points through the eCommerce email marketing loyalty program. Below are a few examples of eCommerce loyalty rewards.
  • They do prioritize your brand over other umpteen brands out there.
  • They do promote your business by word of mouth and by sharing their success stories along with the good experiences with you.
  • It is easier to sell something to your existing customers.
  • Retaining existing customers is cheaper than acquiring a new one.
  • Tend to provide honest and constructive feedback.
  • So you stand a very good chance to stand out over others who do not reward loyalty.

How to earn customer loyalty?

Let me be frank and say that it is one of the toughest things to achieve. It does not develop due to one factor. Instead due to a set of combinatorial factors. And it develops over time. Some of the factors increasing customer loyalty are listed below.

  • Quality product/service
  • Timely delivery
  • Optimal pricing
  • Satisfying discounts/offers
  • Good customer and feedback support system

Quality product/service – Quality is the first checkpoint once approved and accepted by customers. There is a good probability of success in terms of customer loyalty.
Conc

Timely delivery/shipment – Customer time should be valued and making them wait for too long is going to affect customer satisfaction. In most of the customer review sections, you can witness the satisfaction and happiness related to timely delivery.

Optimal pricing – Price is a very critical factor. Customers have to get convinced that it is worth the pay. Because remember that there are umpteen competitors out there.

Satisfying discounts/offers – In continuaConction of the price factor, discounts ensuring a better deal enhances customer loyalty.

Good customer and feedback support system – Always take an effort to listen to the hurdles your customers are facing. Never fail to consider constructive feedback.

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How to earn out of customer loyalty?

After earning loyal customers one needs to know how to retain, gain more and earn more sales out of them.

In this part, we are going to focus on how to retain your eCommerce customer loyalty. Also, get a glimpse of customer expansion making use of eCommerce loyalty programs.

  • Reward loyalty with credits
  • Membership
  • Brand collaboration
  • Let us play a game with loyalty
  • Social Rewards
  • Referral rewards
  • Discounts for loyalty
  • Different tiers of loyalty programs
  • Upfront payment schemes for loyal customers
  • Loyalty program with a philanthropic aspect

Reward loyalty with credits

The first thing you need to do after observing loyalty is to acknowledge and appreciate the same. At the same time offer an economical yet attractive loyalty reward. You can also try sending next order coupons to your customers with the help of automation tools.

Introduce a credit system to reward and retain your customers. Credits are digital bonus points given to individual customers. These can be converted into discounts and digital money that can be used for future purchases from you or your collaborator. You can include reward points through the eCommerce email marketing loyalty program. Below are a few examples of eCommerce loyalty rewards.

In the below example there is an exclusive deal where Ami clubwear gives a 60% offer to a product that can be availed earlier with a coupon code.

Early access email

Membership

Provide membership to your customers. By this, you convince your customers to stay committed to your brand for a defined period of time.

This is a very advantageous strategy where you being the owner get to communicate with your customers regularly. Especially you can move towards customer segmentation by making a list of your membership customers. This facilitates a personalized approach towards your loyal customers. And as a reward for your fellow customers, you can benefit them with discounts, offers and so on for joining into membership.

You get a fair idea about the product demand and can decide how much stock to keep.

Brand collaboration

By working with another brand you get more exposure to develop yours. This is one of the best cross-promotional strategies. It also helps you to cut down your marketing cost factor. Here this gives rise to an interesting scenario like,

“Your customers are my customers, my customers are your customers”

Collaborators usually tend to promote their niche products and services. Like an eCommerce, the home appliance store will collaborate with a bank.

In the below example you can buy any of our home appliances with credit/debit cards from the below-mentioned bank and redeem the bonus.

Bank of america bonus

Let us play a game with loyalty

There is a general opinion that most of the loyalty programs appear the same and not so engaging. So, it will be effective to introduce the ones that are unique and fun-filled. Once in awhile engage your customers by providing entertainment and then convert that event into sales.

Here what you can do is like involving your customers in fun game activity. Then convert the points secured during the game into credits to avail offers by which you can motivate customers to make a purchase.

In the below example spin the wheel win 50 points with which you can avail 50% off on 100 plus products from our store.

Spin the wheel loyalty program

Social Rewards

Social reward focuses on providing discounts that are given as a reward for a customer’s social media promotions about your business.

As social media has become an irresistible marketing platform, marketers and researchers are looking for the best ways and strategies to utilize the same.

Eg: Earn 5 credit points after tweeting about our brand, sharing our post. You can later use the 5 points as a discount during purchase.

Referral rewards

Referral rewards mainly include “invite and earn” promotional strategies. Here a customer earns rewards for bringing in new customers through a Referral program that can be run with the best Referral apps.

With referral rewards, you can motivate word of mouth promotions from your customers. Word of mouth is known to be one of the best loyalty rewards achieved.

Eg: Refer and earn a gift card worth $20 for your next purchase.

Discounts for loyalty

Discounts do not just stop with attracting customers they also help you maintain your customer base intact. Because you can do a lot with it like giving a very straightforward 10 percent offer to a complex conditional discount. But before giving discounts please note that it is always recommended to learn about discount types, understand each of its benefits and how to set up them first.

Here in the below example, there are 3 unique products in your cart A, B, and C. Provided you are buying 10 pieces of A, one piece of B and C. Here you can set up discounts by providing the product with the lowest price among the products in your cart for free.

Checkout screenshot

Discounts that attracts loyalty

Though your regular customer gets the title “loyal customer” also consider bulk purchasers, special customers who make purchases with a higher value into your loyalty programs. You can surprise them with bulk discounts, tiered pricing, dynamic pricing and so on using a discount plugin. This can potentially convert your valuable customers into loyal ones.

Different tiers of loyalty programs

How will you exactly weigh loyalty? Reward your customers based on their level of loyalty. Well, you can engage different customers into different sets of loyalty programs.

Because customer segmentation based on their shopping behavior opens up wide scopes for increasing revenue. Providing loyalty benefits for customers who have completed less number of purchases encourages initial loyalty for more purchases.

Eg: Gift card worth $20 for customers who had made orders worth $1000 so far.

10% off on total cart for customers who had made orders worth $600 so far.

Upfront payment for loyal customers

A Loyal customer itself denotes those who do regular purchases. Hence why not collect advance payment from them?

Upfront payments are highly beneficial from a regular customer’s point of view as it turns out to be cheaper than the regular payment. It also ensures regular product/service supply and hidden cost shocks are avoided. From the store owner’s point of view, there are still greater benefits like predictable cash flow, receiving an advance payment, customer retention and so on.

In the below example you are subscribing to a weekly veggie box for which you are paying up front.

Veggies box

Loyalty program with a philanthropic aspect

There are many institutions, firms, governmental and non-governmental organizations where philanthropy is one of their vision and mission. If you and your business also intend to behold such ideologies, you can very well involve your customers to contribute towards the same. Because the idea of contributing to the needy can motivate customers to buy more.

Here is one of the successful loyalty programs examples below.

In the below example you buy one of these eco-friendly toothbrushes from Smile Squared and you donate one to the needy.

Buy one Give one

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Conclusion

In summary, the best way to build loyal customers is by providing convincing customer benefits and good customer support in addition to quality products. A promising way to retain loyal customers is by identifying them, communicating with them, providing additional benefits and feel-good customer experiences.

“Never lose one loyal customer”

Pay some attention to your loyal customers. In the run of expanding your business and attracting new customers, you should never forget your old, loyal, regular ones. Utilize customer eCommerce loyalty programs to the fullest. Because you need a sustainable business model to be futuristic.

Further, the right loyalty program has the immense potential to increase your sales. But to figure what gets better engagements, you need to imbibe the proven hacks at the same time be open towards doing some experimentation.

A lot of experimentation and attractive benefits can be tried out with eCommerce customer loyalty programs. Take the help of eCommerce marketing and remarketing automation tools like the ones used for cart recovery, giving discounts and so on.