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Loyalty Programs

How to Build a Customer-Focused Loyalty Program

Written by 
Brad Davis
October 21, 2021

When designing a loyalty program (or any kind of marketing strategy, for that matter), it’s very easy to get tunnel vision on your own motives and objectives. And while it’s crucial that your loyalty program turns a profit for your business, you’ll find that the most successful rewards programs out there are designed with the customer in mind, not the brand.

So how do you build a customer-focused loyalty program?

1. Tell your customers how to get the most out of your products and earn more rewards

screenshot of loreal paris webpage

Image Source: L’Oreal Paris

One of the most effective ways to show your customers that your business actually cares about them, is to give them tips and advice on how to enhance their own experience with your brand.

IKEA does this all the time with innovative interior design blogs and useful hacks for improving functionality. Starbucks is exceptionally good at showing its customers how to maximise their loyalty program rewards, with step-by-step guides to the menu challenges and snappy descriptions on how the Double Points Days and Happy Hour promotions work.

This “customer first” approach demonstrates that you want them to feel like a VIP, and that you’re willing to invest in mutually beneficial customer lifetime values.

Consider creating a content calendar that sees your business posting quality original content on your website and socials on a regular ongoing basis. This can then be included in newsletters, which get sent out to your local customer base.

2. Deliver memories instead of discounts, with experiential rewards

screenshot of nordstrom nordy club webpage

Image Source: Nordstrom Nordy Club

Free tickets to a soft opening, product launch or other kind of industry event are much more personal than a “Buy One Get One Free” offer, don’t you think? The same goes for movie rewards, or a special prize draw for a return trip to Tokyo, for example.

By finding a way to weave experiential rewards into your customer journey, you build a much more customer-focused loyalty program that gets people talking… and this creates brand ambassadors, which is what any decent loyalty marketer should be striving for!

Have a think about local businesses you might be able to partner with in order to deliver a more wholesome loyalty program experience that mutually benefits everyone. There’s also smaller, easily implemented ways to deliver experiential rewards, like skip-the-queue perks, for example.

3. Invite your customers into the brand identity, by rewarding user-generated content

nike instagram post of woman wearing nike shoes

Image Source: Nike Instagram

User-generated content (UGC) is any content concerning a brand or its products, which isn’t created by that brand. For example, any time someone reviews a new video game on their online podcast, this is UGC.

The same goes for people who post a YouTube tutorial on different ways you can style L’Oreal’s newest eyeliner or lipstick. It can even be as simple as taking a snapshot of your breakfast, uploading it to Instagram and tagging the café in your post.

TripAdvisor reviews, blogs, videos, images and other forms of UGC are great for expanding brand awareness without the business actually having to do anything… so why not incentivise your customers to do it?

Rather than simply rewarding people for spending money with your brand, many businesses are starting to reward their customers for any kind of engagement. Not only does this drive higher customer retention, but it also creates a stronger community around your brand. Needless to say, this is excellent for building loyalty.

“UGC is a highly effective way to use your existing customers to attain new ones,” says Stamp Me’s Michaela Ward. “It also provides businesses with a wealth of data, which you can use to personalize each customer’s experience and accommodate their unique preferences.”

This brings us to the next point, which is arguably the most important technique for how to build a customer-focused loyalty program.

4. Get personal, with targeted communications and tailored offers

hand holding phone

Any time a website gives you a list of recommended products, or you receive an email offering you an exclusive deal based on your specific shopping preferences – this is personalization hard at work.

By analysing the data received from a customer’s previous transactions (what they buy, when they buy it, how often they shop with your brand, whether they prefer to shop in-store or online, etc.), you can tailor their experience to appeal to their unique tastes and specific needs.

According to a recent “Reimagining Commerce: Global Findings” annual report from Episerver, nine out of 10 consumers don’t mind sharing their data with brands if it helps to deliver a more personalized shopping experience.

5. Build unknown milestones into your rewards structure to catch customers off-guard

wrapped gift and wrapping paper

This is a popular marketing technique known as Surprise & Delight, and it involves building additional rewards into your automated loyalty program structure that the customer doesn’t know about.

This way, when the customer hits these unknown milestones (i.e. one-month signup anniversary, or first 100 loyalty points accumulated), they receive an unexpected reward that will inevitably strengthen their emotional connection to your brand.

Even small gestures are enough to activate this reaction – a free coffee, or complimentary shipping, for example.

6. Make your loyalty program as simple and convenient as possible

woman smiling at phone

The best way to build a customer-focused loyalty program is to make it easy for people to engage with it. This is where digital loyalty apps come into play…

With a digital loyalty app, you can:

  • Digitalise the traditional “Buy X, Get Y” paper punchcards
  • Send customers targeted texts and push notifications
  • Present customers with multiple offers to choose from
  • Gamify the loyalty process with incremental Scratch & Win-style promotions
  • Give customers a special reward on their birthday
  • Provide a contactless loyalty experience (more COVID-friendly)

All of these features and functions can be automated, so your loyalty program runs seamlessly while you focus on other areas of the business. Not only does a digital loyalty app make life easy for your customers, but it’s remarkably quick and easy for your business to set up.

As an example, Stamp Me provides countless businesses of all shapes and sizes across the globe with a highly interactive digital rewards platform and loyalty app to keep their customers engaged. The app can be used across multiple stores and locations, integrated with your ecommerce site, and easily implemented within hours.

stamp me digital loyalty app offers

Still want to learn more about how to build a customer-focused loyalty program? Stamp Me Loyalty Solutions provides a whole host of helpful resources for how to design a highly effective loyalty program that consistently increases customer retention and brand loyalty for your business.

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