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Loyalty Programs

How to Launch a Loyalty Program on a Tight Budget

Written by 
Brad Davis
December 31, 2021

Eager to launch an enticing rewards program that’ll keep your customers coming through the door time and time again? While most people have a general understanding of how loyalty programs work to retain more customers and boost brand loyalty, the thought of actually implementing one may seem daunting and expensive to some businesses.

And yet, launching a loyalty program for your business doesn’t have to be a costly affair. Not only that, but you can actually offer your customers a highly advanced digital loyalty experience that’s on par with some of the biggest name brands out there.

With a whopping USD $75 billion spent on loyalty management globally in 2019, investing in customer loyalty has never been more important (or competitive!).

Thankfully, there’s a whole host of solutions out there to help you launch a loyalty program on a tight budget – without sacrificing all the bells and whistles that programs like Nike and Starbucks Rewards offer.

Here are some helpful tips for getting your loyalty program off the ground and noticed by customers, without breaking the bank.

Want to launch your loyalty program but need a bit of help? Check out our free Digital Loyalty Program Launch Checklist!

1. Opt for a SaaS solution

Digital punch cards are replacing paper cards
Digital punch cards are replacing traditional paper ones

What do I mean by this? Well it might be tempting to go for a “paper punch card” system to keep things simple. However, this can easily end up costing more than a digital rewards program, with less impact on customers.Paper loyalty cards get lost, thrown out or exiled to the deepest crevasses of the desk drawer or glove compartment. Printing costs can get extortionate with the speed in which loyalty cards tend to fly off the POS counter, even though engagement remains low – customers take one away with them, and then never use it. Of course, there’s the environmental factor of constantly printing cards to consider as well.

And finally, 75% of consumers claim to be more inclined to make purchases from brands that know their name, transaction history and other data that facilitates recommended products for a more personalised experience.

Kinjo Sushi and Grill restaurant's digital stamp card
Kinjo Sushi & Grill Restaurant's digital loyalty card

And unless you’re willing to invest heavily in POS-integrated software or a custom-built digital rewards platform (not ideal for launching a loyalty program on a tight budget), then a digital loyalty app provider is the way to go.

Digital loyalty app providers give your business a way to engage customers with a rewards program that is:

  • Easy for customers to use
  • Affordable for businesses to run
  • Quick and convenient to roll out
  • Accessible to customers anytime, anywhere, from their pocket

The idea is that customers download your mobile app (provided to you by a third party, usually for a monthly subscription fee) and scan a code at checkout to accrue points and redeem rewards for each purchase. It’s essentially a digital version of a paper punch card, but with several key differences.

First of all, the details of each transaction are stored under the customer’s digital profile, and this allows your business to tailor their shopping experience based on their specific preferences.

Every customer can now receive targeted offers and recommendations directly to their mobile device via text, email or push notification. Customer X receives different communications to Customer Y, and the relationship with your brand becomes more personal.

Gamified features can easily be introduced to enhance the loyalty experience, plus “surprise and delight” components like spontaneous birthday rewards and signup anniversary gifts.

The platform itself is managed by your chosen digital loyalty app provider, so your customers enjoy all the bells and whistles of a sophisticated rewards program and your business is spared the headache of managing highly advanced technological software. Just how advanced depends on the next point…

2. Select a plan that suits your budget

Stamp Me digital loyalty program's pricing
Stamp Me digital loyalty program's pricing

The benefit of digital loyalty apps is that they cover the full scope of price points. As an example, Stamp Me starts as low as $43 per month and goes up to $180+ per month for more enhanced features and functions.

This allows small business owners to roll out a basic digital loyalty app for their customers at a very low cost, and then gradually improve their loyalty experience by upgrading to enhanced versions once it starts to become profitable.

For new businesses that are still figuring out how to best structure their loyalty program and rewards offering for best results, this “toe in the water” approach is a low-risk solution for launching a loyalty program on a tight budget.

3. Embrace cost-free promotional methods

launching a loyalty program on a tight budget with free signup gifts
Free sign-up reward

It’s always an exciting moment when your loyalty program is officially up and running! But how do you get customers to be as excited about it as you are?

  • Your employees are ambassadors for your brand, so it’s important to educate them on the ins and outs of how the new loyalty program works, and its many perks and benefits.
  • Consider rewarding customers just for signing up – this helps you build registrations much faster, and provides instant gratification to the customer.
  • Rewarding referrals will encourage your existing loyalty program members to get their friends and family on-board.
  • You don’t need to pay for online advertising in order to market your loyalty program on social media! Have some fun and get creative with how to use games and competitions to drum up some hype online.
  • The odd “spontaneous” and unexpected treat never hurts to keep your brand front-of-mind for customers who have signed up but perhaps aren’t engaging with your loyalty program.

Case study: How the Pine Scone Café loyalty program works

A customer with Pine Scone Cafe's loyalty program on his phone

With two locations in North Carolina, Pine Scone Cafe serves a variety of delicious homemade scones and cafe drinks. A few years ago, the owners decided it was time to invest in a digital loyalty solution that would help them to retain, communicate with and build loyalty among their valued patrons.

Specifically, Pine Scone Café wanted to:

  • Access personal information so its customers were no longer anonymous
  • Motivate customers to come back to the cafe and make repeat purchases
  • Keep the brand front-of-mind for existing customers
  • Enhance the emotional connection between the cafe and its patrons

Pine Scone Café’s loyalty program is delightfully straightforward:For every in-house prepared drinks purchase, the customer receives a stamp on their digital punch card, issued at checkout. Once they’ve collected six stamps, a reward of a free scone is automatically triggered. The reward is stored on their account, ready to redeem on their next visit. The voucher counts down from 3 minutes and has falling confetti, so it’s clear to the staff it’s a real voucher, not a screenshot.

As mentioned in the innovative promotional suggestions listed earlier in this article, Pine Scone Café customers are treated to a free scone just for signing up to the loyalty program. Needless to say, this incentive is promoted by the staff, with in-store signs and regular posts on social media as well.

As for existing members, management uses Stamp Me’s text messaging feature to incrementally send out messages at times when the business is typically quiet, or on common “slow days”.

Since implementing Stamp Me back in 2017 for both venues, Pine Scone Cafe has continued to receive great customer feedback and the app has become a crucial element in the shops’ day-to-day business and marketing operations.

Launch a loyalty program on a tight budget, with Stamp Me

One final statistic for you. Accenture reports that 78% of consumers say they are retracting loyalty at a faster pace than they were three years ago; meaning their loyalty is increasingly hard to acquire and retain.

A decent loyalty program might not cost a lot to implement, but it’s definitely important to have. For more information about how Stamp Me can help your business launch a cost-efficient loyalty program, don’t hesitate to contact our friendly team.

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