{"id":91248,"date":"2022-03-25T09:59:05","date_gmt":"2022-03-25T16:59:05","guid":{"rendered":"https:\/\/thegood.com\/?post_type=insights&#038;p=91248"},"modified":"2024-09-09T09:53:25","modified_gmt":"2024-09-09T16:53:25","slug":"ecommerce-loyalty-programs","status":"publish","type":"insights","link":"https:\/\/thegood.com\/insights\/ecommerce-loyalty-programs\/","title":{"rendered":"How To Build Ecommerce Loyalty Programs That Improve Customer Retention &#038; Experience"},"content":{"rendered":"\n<div class=\"wp-block-thegood-key-takeaways c-key-takeaways\"><div class=\"c-key-takeaways__header\"><h3 class=\"c-key-takeaways__title\">Key Takeaways<\/h3><p class=\"c-key-takeaways__description\">By the end of this article, you should have the knowledge and resources to \u201ccheck the box\u201d in these areas\u2026<\/p><\/div><ul class=\"c-key-takeaways__list\"><li>How to turn your one time customers into brand loyalists through an engaging loyalty program<\/li><li>Understand the importance of loyalty programs in a growing ecommerce business<\/li><li>The structure and format of winning ecommerce loyalty programs from top brands<\/li><\/ul><\/div>\n\n\n\n<p>The surge in online shopping, the rise of small ecommerce businesses, and the constant change of consumer preferences are just a few of the reasons ecommerce sales landed at a whopping<a href=\"https:\/\/www.statista.com\/statistics\/379046\/worldwide-retail-e-commerce-sales\/\" target=\"_blank\" rel=\"noreferrer noopener\"> $4.9 trillion<\/a> in 2021.&nbsp;<\/p>\n\n\n\n<p>And the industry isn\u2019t stopping there with sales expected to rise to $7.4 trillion by 2025.&nbsp;<\/p>\n\n\n\n<p>While these numbers promise a bright future for ecommerce businesses, they also pose a competitive threat.&nbsp;<\/p>\n\n\n\n<p>Along with growing sales, there are a growing number of ecommerce businesses. So, it\u2019s more important than ever to provide an excellent <a href=\"https:\/\/thegood.com\/insights\/what-is-cx-customer-experience\/\" target=\"_blank\" rel=\"noreferrer noopener\">customer experience<\/a> that converts and retains.<\/p>\n\n\n\n<p>While sales and discounts are the go to strategies for brands looking to attract lots of customers fast, these are also the tactics that decrease your perceived brand value and total revenue (we could go on and on about why discounting is bad for your brand).&nbsp;<\/p>\n\n\n\n<p>What\u2019s better?&nbsp;<\/p>\n\n\n\n<p>A <strong>consumer-centric ecommerce loyalty program<\/strong>\u2014a must-have for ecommerce businesses. The loyalty programs of today don\u2019t just focus on small incentives and discounts, but delve deeper into experiential rewards like personalized gifts and upgrades that keep the customers happy and returning to the brand.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-why-ecommerce-loyalty-programs-are-important-for-your-business\"><strong>Why ecommerce loyalty programs are important for your business<\/strong><\/h2>\n\n\n\n<p>With compelling rewards, discounts, personalized offers, and exclusive deals, it\u2019s no surprise that <a href=\"https:\/\/nielseniq.com\/global\/en\/insights\/report\/2013\/how-loyal-are-your-customers\/\" target=\"_blank\" rel=\"noreferrer noopener\">84% of customers <\/a>say they\u2019re more likely to engage with a brand with a loyalty program.&nbsp;<\/p>\n\n\n\n<p>Simply put, ecommerce companies with loyalty programs are offering a better experience for shoppers. And because they are building a better experience for their customers, they\u2019re also improving key business metrics like Average Order Value and Customer Lifetime Value (CLV).&nbsp;<\/p>\n\n\n\n<p>When you invest in shopping and brand experiences that retain customers, it pays off.<\/p>\n\n\n\n<p>Here are just a few of the benefits your business might see from offering an ecommerce loyalty program:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Understand what your customers want and retain them:<\/strong> Loyalty programs will give you first-party data about what customers like, don\u2019t like, and what they\u2019re most likely to engage with. You can use this data to provide experiences better suited to their needs and boost retention in the process.<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Increase customer lifetime value (CLV): <\/strong>A well-designed loyalty program can create a customer experience that keeps shoppers returning to your site, therefore increasing CLV. It gives them new reasons to return and continue shopping.&nbsp;<\/li>\n<\/ul>\n\n\n\n<blockquote class=\"wp-block-quote has-text-align-center is-style-large is-layout-flow wp-block-quote-is-layout-flow\" id=\"h-clv-is-crucial-to-have-a-thriving-ecommerce-business-having-a-decent-to-high-clv-allows-you-to-reinvest-those-higher-margin-earnings-into-driving-new-customers-who-later-convert-into-loyal-customers-and-drive-the-flywheel\">\n<p><em>CLV is crucial to have a thriving ecommerce business. Having a decent to high CLV allows you to reinvest those higher margin earnings into <a href=\"https:\/\/thegood.com\/insights\/drive-and-convert-selling-on-amazon-fight-or-join\/\">driving new customers who later convert<\/a> into loyal customers and drive the flywheel.<\/em><\/p>\n<cite><em>-Jon MacDonald, CEO, The Good<\/em><\/cite><\/blockquote>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Turn customers into brand advocates and reach new audiences:<\/strong> Influencer marketing is a superpower in the ecommerce industry because<a href=\"https:\/\/www.ion.co\/twitter-has-released-a-report-showing-consumers-seek-product-recommendations-from-influencers-almost-as-much-as-they-do-from-friends\" target=\"_blank\" rel=\"noreferrer noopener\"> 49% of consumers<\/a> depend on influencer recommendations to make purchase decisions. However, turning existing customers into advocates is even better. With a loyalty program, you can easily identify your best customers through data and purchase history. Offer incentives for referring their friends or group gift ideas when they shop together or meet certain thresholds. You\u2019ve kept a brand loyalist happy and gained a new customer.&nbsp;<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-how-to-implement-a-loyalty-program-that-converts\"><strong>How to implement a loyalty program that converts<\/strong><\/h2>\n\n\n\n<p>Over <a href=\"https:\/\/www.yotpo.com\/blog\/customer-loyalty-survey-data\/\" target=\"_blank\" rel=\"noreferrer noopener\">52% of customers<\/a> will join a loyalty program for a brand they regularly buy from. How can you leverage that engaged audience?&nbsp;<\/p>\n\n\n\n<p>Here&#8217;s a step-by-step guide to building a loyalty program that drives results:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">1. <strong>Define your goals and conduct customer research<\/strong><\/h3>\n\n\n\n<p>No marketing strategy can be successful without objectives and goals to define the direction of your project. So, begin by defining your goals for the loyalty program.<\/p>\n\n\n\n<p>Try setting SMART goals that are specific, measurable, achievable, realistic and timely. For example, instead of saying, &#8220;We want to increase customer retention,&#8221; say, &#8220;We want to increase customer retention by 7% by the end of the 3rd quarter.&#8221;<\/p>\n\n\n\n<p>Once you have your goals established, turn your thinking to your customer base.&nbsp;<\/p>\n\n\n\n<p>To design a loyalty program that provides a great experience, you must understand and address the customers&#8217; needs and preferences.&nbsp;<\/p>\n\n\n\n<blockquote class=\"wp-block-quote has-text-align-center is-style-large is-layout-flow wp-block-quote-is-layout-flow\" id=\"h-if-your-loyalty-program-doesn-t-appeal-to-your-audience-it-will-likely-end-up-as-a-bust-the-whole-point-of-the-program-is-to-entice-customers-to-keep-coming-back-so-if-you-fail-to-tailor-the-rewards-to-your-audience-s-needs-they-won-t-engage-unattainable-rewards-will-also-quickly-turn-off-your-customers-and-could-actually-increase-turnover-through-frustration-and-annoyance-so-it-s-important-to-understand-the-best-ways-to-engage-and-retain-them-through-data-driven-practices\">\n<p><em>If your loyalty program doesn\u2019t appeal to your audience, it will likely end up as a bust. The whole point of the program is to entice customers to keep coming back, so if you fail to tailor the rewards to your audience\u2019s needs, they won\u2019t engage. Unattainable rewards will also quickly turn off your customers, and could actually increase turnover through frustration and annoyance. So, it\u2019s important to understand the best ways to engage and retain them through data-driven practices.<\/em><\/p>\n<cite><strong><em>-Co-Owner and Chief Marketing Officer, <\/em><\/strong><a href=\"https:\/\/www.nolahmattress.com\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong><em>Nolah Mattress<\/em><\/strong><\/a><\/cite><\/blockquote>\n\n\n\n<p>Here\u2019s how you can gauge the customers\u2019 interests, needs and preferences:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Ensure you have a CRM system in place, along with channels that help you gather customer contact information like lead magnets, newsletters, checkout processes, inventory waitlist, etc. This will allow you to maintain an opt-in customer list that you can use to carry out research.<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Use customer behavior tools like <a href=\"https:\/\/www.hotjar.com\/\" target=\"_blank\" rel=\"noreferrer noopener\">Hotjar\u2019s<\/a> heatmaps, session recordings, and exit-intent surveys to understand how your customers currently interact with your site and to find inspiration for your loyalty program.&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Create a <a href=\"https:\/\/thegood.com\/insights\/customer-research\/\" target=\"_blank\" rel=\"noreferrer noopener\">customer research<\/a> survey and attach an incentive like first access to the loyalty program to gather more information about what your customers might value in your loyalty program.&nbsp;<\/li>\n<\/ul>\n\n\n\n<div class=\"wp-block-stackable-columns stk-block-columns stk-block stk-c842da9 reusable-block-2-column good-question-block\" data-block-id=\"c842da9\"><style>.stk-c842da9{max-width:1500px !important;margin-top:30px !important;margin-bottom:30px !important}.stk-c842da9-column{max-width:941px !important}@media screen and (max-width:767px){.stk-c842da9{--stk-col-order-1:2 !important;--stk-col-order-2:1 !important}}<\/style><div class=\"stk-row stk-inner-blocks stk-block-content stk-content-align stk-c842da9-column\">\n<div class=\"wp-block-stackable-column stk-block-column stk-column stk-block stk-8993c44 horizontal-form-container\" data-v=\"4\" data-block-id=\"8993c44\"><style>.stk-8993c44-container{margin-top:0px !important;margin-right:0px !important;margin-bottom:0px !important;margin-left:0px !important;background-color:#c3ddf0 !important;border-top-left-radius:12px !important;border-top-right-radius:12px !important;border-bottom-right-radius:12px !important;border-bottom-left-radius:12px !important;overflow:hidden !important;max-width:701px !important;padding-top:40px !important;padding-right:35px !important;padding-bottom:40px !important;padding-left:35px !important}.stk-8993c44{margin-top:0px !important}.stk-8993c44-container:before{background-color:#c3ddf0 !important}@media screen and (max-width:1023px){.stk-8993c44-container{padding-bottom:60px !important}}@media screen and (max-width:767px){.stk-8993c44-container{padding-bottom:60px !important}}<\/style><style class=\"stk-custom-css\">.stk-8993c44 figure{margin:0 !important}<\/style><div class=\"stk-column-wrapper stk-block-column__content stk-container stk-8993c44-container stk-hover-parent\"><div class=\"stk-block-content stk-inner-blocks stk-8993c44-inner-blocks\">\n<div class=\"wp-block-stackable-heading stk-block-heading stk-block-heading--v2 stk-block stk-791f1b3\" id=\"span-style-color-0277-c-0-class-stk-highlight-enjoying-this-article-span\" data-block-id=\"791f1b3\"><style>.stk-791f1b3{margin-bottom:12px !important}.stk-791f1b3 .stk-block-heading__text{font-size:36px !important;color:#ffffff !important}@media screen and (max-width:1023px){.stk-791f1b3 .stk-block-heading__text{font-size:36px !important}}@media screen and (max-width:767px){.stk-791f1b3 .stk-block-heading__text{font-size:24px !important}}<\/style><h3 class=\"stk-block-heading__text has-text-color has-text-align-center\"><span style=\"color: #0277c0;\" class=\"stk-highlight\">Enjoying this article?<\/span><\/h3><\/div>\n\n\n\n<div class=\"wp-block-stackable-text stk-block-text stk-block stk-30f99ae\" data-block-id=\"30f99ae\"><style>.stk-30f99ae{margin-bottom:20px !important}.stk-30f99ae .stk-block-text__text{color:#ffffff !important}<\/style><p class=\"stk-block-text__text has-text-color has-text-align-center\"><span style=\"color: #000000;\" class=\"stk-highlight\">Subscribe to our newsletter, Good Question, to get insights like this sent straight to your inbox every week.<\/span><\/p><\/div>\n\n\n\n\t\t\t\t\t\t<script>\n\t\t\t\t\t\t\twindow.hsFormsOnReady = window.hsFormsOnReady || [];\n\t\t\t\t\t\t\twindow.hsFormsOnReady.push(()=>{\n\t\t\t\t\t\t\t\thbspt.forms.create({\n\t\t\t\t\t\t\t\t\tportalId: 5834619,\n\t\t\t\t\t\t\t\t\tformId: \"64ede74e-e88f-44c7-996f-78859799755a\",\n\t\t\t\t\t\t\t\t\ttarget: \"#hbspt-form-1768304698000-8674546961\",\n\t\t\t\t\t\t\t\t\tregion: \"na2\",\n\t\t\t\t\t\t\t\t\tcssRequired: \".submitted-message { overflow: auto; } .hs-form-88422a7d-0355-4f27-b674-4b9fcc71560c, .hs-form-ac90f61a-a614-4bcd-b57a-18cd0e91ceff { color: #fff }\",\n\t\t\t\t\t\t\t})});\n\t\t\t\t\t\t<\/script>\n\t\t\t\t\t\t<div class=\"hbspt-form\" id=\"hbspt-form-1768304698000-8674546961\"><\/div>\n<\/div><\/div><\/div>\n<\/div><\/div>\n\n\n\n<h3 class=\"wp-block-heading\">2. <strong>Choose the best loyalty program for your business<\/strong><\/h3>\n\n\n\n<p>Once your goals are established and customer research has been analyzed, your next step is to decide on the format of your program.<\/p>\n\n\n\n<p>Here are a few of the options, and accompanying examples, to get the creative juices flowing:<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Point-based<\/strong><\/h4>\n\n\n\n<p>If you visit Starbucks regularly, you probably already know what a point-based loyalty program looks like.&nbsp;<\/p>\n\n\n\n<p>It allows customers to collect loyalty points when they perform specific actions like making a purchase or sharing about their experience with the brand on social media. At different milestones or point values, participants unlock rewards.&nbsp;<\/p>\n\n\n\n<p>Most points programs are free and have a low barrier to entry. While this attracts more signups it usually means point accumulation &#8211; and rewards redemption &#8211; takes time.<\/p>\n\n\n\n<p>The XPLR Pass by <a href=\"https:\/\/www.thenorthface.com\/\" target=\"_blank\" rel=\"noreferrer noopener\">North Face<\/a>, an activewear and outdoor gear brand, is an excellent example of a point-based loyalty program.&nbsp;<\/p>\n\n\n\n<p>It was voted one of America&#8217;s best loyalty programs and offers a point on every dollar spent. When customers collect 100 points, they get a $10 reward.&nbsp;<\/p>\n\n\n\n<p>ButBut what makes the program really special is the way they tailor additional rewards to the interests of their members. For example, among more common rewards, participants also get early and exclusive access to gear and special opportunities to field test equipment and return it if it doesn\u2019t meet their outdoor exploration standards.&nbsp;<\/p>\n\n\n\n<p>North Face knows that their most loyal shoppers are dedicated to spending time outside\u2026 and they want the best gear to do it. So XPLR pass works to make that experience just a little bit better.<\/p>\n\n\n\n<figure class=\"wp-block-image aligncenter size-large\"><img decoding=\"async\" width=\"1024\" height=\"593\" src=\"https:\/\/thegood.com\/wp-content\/uploads\/image-320-1024x593.png\" alt=\"XPLR Pass ecommerce loyalty programs\" class=\"wp-image-98413\" srcset=\"https:\/\/thegood.com\/wp-content\/uploads\/image-320-1024x593.png 1024w, https:\/\/thegood.com\/wp-content\/uploads\/image-320-300x174.png 300w, https:\/\/thegood.com\/wp-content\/uploads\/image-320-768x445.png 768w, https:\/\/thegood.com\/wp-content\/uploads\/image-320-1536x890.png 1536w, https:\/\/thegood.com\/wp-content\/uploads\/image-320-610x353.png 610w, https:\/\/thegood.com\/wp-content\/uploads\/image-320-600x348.png 600w, https:\/\/thegood.com\/wp-content\/uploads\/image-320.png 1600w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Tiered program<\/strong><\/h4>\n\n\n\n<p>This program type rewards customers differently based on their loyalty to the brand.&nbsp;<\/p>\n\n\n\n<p>As customers spend more money and complete specific tasks, they move up the tiered ladder. The higher they go, the more exclusive and bigger benefits they enjoy.<\/p>\n\n\n\n<p><a href=\"https:\/\/www.sephora.com\/\" target=\"_blank\" rel=\"noreferrer noopener\">Sephora<\/a>\u2019s Beauty Insider is a successful tiered loyalty program. Customers earn points on every dollar spent and move between three tiers\u2014Insiders, VIB and Rouge.&nbsp;<\/p>\n\n\n\n<p>Sephora still allows non-spenders to opt-in to the program for exclusive discounts and deals. But as loyal beauty insiders spend more, they\u2019re rewarded with better savings, discounts, free shipping, and more.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image aligncenter size-large\"><img decoding=\"async\" width=\"1024\" height=\"676\" src=\"https:\/\/thegood.com\/wp-content\/uploads\/image-321-1024x676.png\" alt=\"Sephora beauty insider ecommerce loyalty programs\" class=\"wp-image-98414\" srcset=\"https:\/\/thegood.com\/wp-content\/uploads\/image-321-1024x676.png 1024w, https:\/\/thegood.com\/wp-content\/uploads\/image-321-300x198.png 300w, https:\/\/thegood.com\/wp-content\/uploads\/image-321-768x507.png 768w, https:\/\/thegood.com\/wp-content\/uploads\/image-321-1536x1014.png 1536w, https:\/\/thegood.com\/wp-content\/uploads\/image-321-610x403.png 610w, https:\/\/thegood.com\/wp-content\/uploads\/image-321-600x396.png 600w, https:\/\/thegood.com\/wp-content\/uploads\/image-321.png 1600w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Paid\/subscription program<\/strong><\/h4>\n\n\n\n<p>The paid loyalty program charges a one-time fee that grants customers access to additional perks. Similarly, in a subscription-based loyalty program, customers are charged a recurring monthly\/quarter fee instead of a one-time fee.<\/p>\n\n\n\n<p>This program works because:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>You\u2019re happy that the membership fee keeps customers loyal. For example, why would they order from a new food delivery app if they pay a monthly fee and get free delivery with your app that has a loyalty program?<\/li>\n\n\n\n<li>Your customer is happy that the fee is cheaper than what they would spend on multiple purchases. For your loyal customers, the amount they\u2019re spending is nominal compared to what they would spend without the accompanying rewards.&nbsp;<\/li>\n<\/ul>\n\n\n\n<p><a href=\"https:\/\/www.amazon.com\/amazonprime?_encoding=UTF8&amp;%2AVersion%2A=1&amp;%2Aentries%2A=0\" target=\"_blank\" rel=\"noreferrer noopener\">Amazon Prime<\/a> is a great example of this. A Prime membership offers free two-day delivery on your orders. Currently, <a href=\"https:\/\/backlinko.com\/amazon-prime-users\" target=\"_blank\" rel=\"noreferrer noopener\">148.6 million Prime members<\/a> in the US alone pay $14.99 per month, registering over $25 billion in subscription fees.<\/p>\n\n\n\n<figure class=\"wp-block-image aligncenter size-large\"><img decoding=\"async\" width=\"1024\" height=\"721\" src=\"https:\/\/thegood.com\/wp-content\/uploads\/image-322-1024x721.png\" alt=\"Amazon prime ecommerce loyalty programs\" class=\"wp-image-98415\" srcset=\"https:\/\/thegood.com\/wp-content\/uploads\/image-322-1024x721.png 1024w, https:\/\/thegood.com\/wp-content\/uploads\/image-322-300x211.png 300w, https:\/\/thegood.com\/wp-content\/uploads\/image-322-768x541.png 768w, https:\/\/thegood.com\/wp-content\/uploads\/image-322-1536x1082.png 1536w, https:\/\/thegood.com\/wp-content\/uploads\/image-322-610x430.png 610w, https:\/\/thegood.com\/wp-content\/uploads\/image-322-600x423.png 600w, https:\/\/thegood.com\/wp-content\/uploads\/image-322.png 1600w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Partner or community based program&nbsp;<\/strong><\/h4>\n\n\n\n<p>A slightly complex yet interesting loyalty program involves partnerships with similar brands to offer combined incentives and rewards. For example, a clothing brand can partner with an accessories or footwear brand to provide discounted product bundles and other incentives as part of the loyalty program.<\/p>\n\n\n\n<p>Similarly, you can build a community-based program where the brand connects customers with other like-minded customers who can fulfill and complete tasks together to unlock incentives while networking.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">3. <strong>Decide your rewarding criteria<\/strong><\/h3>\n\n\n\n<p>Your loyalty program will fall flat if you don\u2019t decide which customer behaviors you want to reward, your rewarding criteria, and what kind of benefits you\u2019ll offer.&nbsp;<\/p>\n\n\n\n<p>While you may feel like you need big and complicated rewards to incentivize customers, that&#8217;s hardly ever true. It\u2019s best to start with a simple reward and simple criteria &#8211; and then add complexity as you grow the program.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote has-text-align-center is-style-large is-layout-flow wp-block-quote-is-layout-flow\" id=\"h-the-fragrance-world-s-loyalty-scheme-is-quite-new-however-we-ve-got-great-returns-on-the-incentive-to-invite-friends-a-customer-refers-a-friend-and-both-get-3-off-their-next-order-we-have-customers-who-have-referred-over-10-friends-with-an-aov-of-25-250-this-could-cost-us-around-50-70-for-ppc-but-was-cheaper-to-acquire-these-customers-through-the-loyalty-scheme-by-offering-a-small-incentive\">\n<p><em>\u201cThe Fragrance World\u2019s loyalty scheme is quite new, however we\u2019ve got great returns on the incentive to invite friends. A customer refers a friend, and both get \u00a33 off their next order. We have customers who have referred over 10 friends with an AOV of \u00a325 (\u00a3250), this could cost us around \u00a350-\u00a370 for PPC but was cheaper to acquire these customers through the loyalty scheme by offering a small incentive.\u201d<\/em><\/p>\n<cite><strong><em>-Katie Johnson, Founder,&nbsp; <\/em><\/strong><a href=\"https:\/\/thefragranceworld.co.uk\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong><em>The Fragrance World<\/em><\/strong><\/a><\/cite><\/blockquote>\n\n\n\n<p>Here are some actions you can reward, apart from a purchase:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Referring a friend<\/li>\n\n\n\n<li>Sharing about your brand on social media<\/li>\n\n\n\n<li>Signing up for the newsletter<\/li>\n\n\n\n<li>Giving a <a href=\"https:\/\/thegood.com\/insights\/how-to-leverage-product-reviews-to-improve-conversion-rates\/\">product<\/a> review&nbsp;<\/li>\n\n\n\n<li>Customer anniversary or birthday<\/li>\n\n\n\n<li>Reaching a certain threshold in purchases<\/li>\n<\/ul>\n\n\n\n<p>It\u2019s also important that you don\u2019t just chase discounts and free shipping as the only incentives in ecommerce. Go for experiential rewards like one round of free clothing alterations, free dry cleaning service, pick and drop for a brand event, sampling for a new product launch, etc.&nbsp;<\/p>\n\n\n\n<p>You want to incentivize your customers not just by saving money but also by improving their brand perception and shopping experience, so they continue buying from you.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">4. <strong>Invest in a customer loyalty software<\/strong><\/h3>\n\n\n\n<p>Managing a customer loyalty program across countries, currencies, and devices isn\u2019t an easy feat. You need a solid ecommerce customer loyalty software to organize and streamline your process for customers and your employees.<\/p>\n\n\n\n<p>These tools record purchases\u2014specifically made by loyalty program members\u2014calculates their point accumulation, allows them to buy and redeem those points, and offers interactive tools to make the process even more fun for the customers. <a href=\"https:\/\/www.yotpo.com\/\" target=\"_blank\" rel=\"noreferrer noopener\">Yotpo<\/a> is a good option to start your exploration or check out <a href=\"https:\/\/www.g2.com\/categories\/proactive-customer-retention#learn-more\" target=\"_blank\" rel=\"noreferrer noopener\">G2s customer retention software<\/a> resource.<\/p>\n\n\n\n<p>Finding the right software will help you put the process on auto-pilot, so you can focus on delivering the experience.<\/p>\n\n\n\n<p>As a bonus, this software will also give you insights around repeat purchases, your best customers, most popular incentives, and feedback so you can iterate on your loyalty program.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">5. <strong>Begin experimenting and tweaking<\/strong><\/h3>\n\n\n\n<p>Once you\u2019ve got your ecommerce loyalty program up and running, it\u2019s important to check your progress and how customers respond to your rewards and incentives system.<\/p>\n\n\n\n<p>You can use your loyalty program software to gather data and combine it with your online store data to assess what\u2019s working and what\u2019s not. While there are many metrics you can evaluate, here are three to start with:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Customer churn rate:<\/strong> The rate at which people stop being your customers is the churn rate. If you\u2019re running a paid loyalty program, you also want to look at the rate at which customers stop renewing or downgrade their subscription with you. This will tell you if your loyalty program effectively retains customers or needs improvement.<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Net Promoter Score (NPS):<\/strong> This is a customer experience metric that suggests how likely a customer is to recommend your brand on a scale of 1-10.<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/thegood.com\/insights\/increasing-customer-lifetime-value\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Customer Lifetime Value (CLV)<\/strong><\/a><strong>: <\/strong>&nbsp;CLV is one of the most important factors determining loyalty program success. It tells you how much customers are spending, how frequently they\u2019re shopping and how long they stay in your program. It indicates the longevity of a customer relationship, and a high CLV suggests customer satisfaction and retention.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-ecommerce-loyalty-programs-are-here-to-stay\"><strong>Ecommerce loyalty programs are here to stay<\/strong><\/h2>\n\n\n\n<p>There\u2019s no one-size-fits-all approach to build an ecommerce loyalty program that drives more sales. It\u2019s important to tailor your loyalty program to your customers&#8217; needs with personalized experiences that bring them back for repeat purchases.<\/p>\n\n\n\n<p>Start small, keep a close eye on your data, and iterate\u2014all while placing the customer at the center of your program.&nbsp;<\/p>\n\n\n\n<div class=\"wp-block-stackable-columns stk-block-columns stk-block stk-x4x1ipy reusable-block-2-column good-question-block\" data-block-id=\"x4x1ipy\"><style>.stk-x4x1ipy{max-width:1500px !important;margin-top:30px !important;margin-bottom:30px !important}.stk-x4x1ipy-column{max-width:941px !important}@media screen and (max-width:767px){.stk-x4x1ipy{--stk-col-order-1:2 !important;--stk-col-order-2:1 !important}}<\/style><div class=\"stk-row stk-inner-blocks stk-block-content stk-content-align stk-x4x1ipy-column\">\n<div class=\"wp-block-stackable-column stk-block-column stk-column stk-block stk-rdd2il8 horizontal-form-container\" data-v=\"4\" data-block-id=\"rdd2il8\"><style>.stk-rdd2il8-container{margin-top:0px !important;margin-right:0px !important;margin-bottom:0px !important;margin-left:0px !important;background-color:#c3ddf0 !important;border-top-left-radius:12px !important;border-top-right-radius:12px !important;border-bottom-right-radius:12px !important;border-bottom-left-radius:12px !important;overflow:hidden !important;max-width:701px !important;padding-top:40px !important;padding-right:35px !important;padding-bottom:40px !important;padding-left:35px !important}.stk-rdd2il8{margin-top:0px !important}.stk-rdd2il8-container:before{background-color:#c3ddf0 !important}@media screen and (max-width:1023px){.stk-rdd2il8-container{padding-bottom:60px !important}}@media screen and (max-width:767px){.stk-rdd2il8-container{padding-bottom:60px !important}}<\/style><style class=\"stk-custom-css\">.stk-rdd2il8 figure{margin:0 !important}<\/style><div class=\"stk-column-wrapper stk-block-column__content stk-container stk-rdd2il8-container stk-hover-parent\"><div class=\"stk-block-content stk-inner-blocks stk-rdd2il8-inner-blocks\">\n<div class=\"wp-block-stackable-heading stk-block-heading stk-block-heading--v2 stk-block stk-dronx83\" id=\"span-style-color-0277-c-0-class-stk-highlight-enjoying-this-article-span\" data-block-id=\"dronx83\"><style>.stk-dronx83{margin-bottom:12px !important}.stk-dronx83 .stk-block-heading__text{font-size:36px !important;color:#ffffff !important}@media screen and (max-width:1023px){.stk-dronx83 .stk-block-heading__text{font-size:36px !important}}@media screen and (max-width:767px){.stk-dronx83 .stk-block-heading__text{font-size:24px !important}}<\/style><h3 class=\"stk-block-heading__text has-text-color has-text-align-center\"><span style=\"color: #0277c0;\" class=\"stk-highlight\">Enjoying this article?<\/span><\/h3><\/div>\n\n\n\n<div class=\"wp-block-stackable-text stk-block-text stk-block stk-6rf769z\" data-block-id=\"6rf769z\"><style>.stk-6rf769z{margin-bottom:20px !important}.stk-6rf769z .stk-block-text__text{color:#ffffff !important}<\/style><p class=\"stk-block-text__text has-text-color has-text-align-center\"><span style=\"color: #000000;\" class=\"stk-highlight\">Subscribe to our newsletter, Good Question, to get insights like this sent straight to your inbox every week.<\/span><\/p><\/div>\n\n\n\n\t\t\t\t\t\t<script>\n\t\t\t\t\t\t\twindow.hsFormsOnReady = window.hsFormsOnReady || [];\n\t\t\t\t\t\t\twindow.hsFormsOnReady.push(()=>{\n\t\t\t\t\t\t\t\thbspt.forms.create({\n\t\t\t\t\t\t\t\t\tportalId: 5834619,\n\t\t\t\t\t\t\t\t\tformId: \"64ede74e-e88f-44c7-996f-78859799755a\",\n\t\t\t\t\t\t\t\t\ttarget: \"#hbspt-form-1768304698000-1457682419\",\n\t\t\t\t\t\t\t\t\tregion: \"na2\",\n\t\t\t\t\t\t\t\t\tcssRequired: \".submitted-message { overflow: auto; } .hs-form-88422a7d-0355-4f27-b674-4b9fcc71560c, .hs-form-ac90f61a-a614-4bcd-b57a-18cd0e91ceff { color: #fff }\",\n\t\t\t\t\t\t\t})});\n\t\t\t\t\t\t<\/script>\n\t\t\t\t\t\t<div class=\"hbspt-form\" id=\"hbspt-form-1768304698000-1457682419\"><\/div>\n<\/div><\/div><\/div>\n<\/div><\/div>\n<div class=\"tkugp-items-wrap\"><div class=\"tkugp-bottomcontent\"><\/div><\/div>","protected":false},"author":62,"featured_media":91264,"comment_status":"open","ping_status":"closed","template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","wpcf-summary":["This is your guide to ecommerce loyalty programs that improve the shopping experience and boost your customer lifetime value. Read on to learn how to build yours."]},"insight-category":[10073],"insight-tag":[7006,7004,83],"class_list":["post-91248","insights","type-insights","status-publish","format-standard","has-post-thumbnail","hentry","insight-category-conversion-tactics","insight-tag-ecommerce","insight-tag-marketing","insight-tag-repeat-conversions"],"acf":[],"featured_image_urls_v2":{"full":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program.png",1241,822,false],"thumbnail":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-150x150.png",150,150,true],"medium":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-300x199.png",300,199,true],"medium_large":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-768x509.png",768,509,true],"large":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-1024x678.png",1024,678,true],"1536x1536":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program.png",1241,822,false],"2048x2048":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program.png",1241,822,false],"teaser":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-380x215.png",380,215,true],"teaser-large":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-760x430.png",760,430,true],"insights-featured":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-600x397.png",600,397,true],"case-study-logo-small":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program.png",113,75,false],"gform-image-choice-sm":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program.png",300,199,false],"gform-image-choice-md":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program.png",400,265,false],"gform-image-choice-lg":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program.png",600,397,false],"profile_24":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-24x24.png",24,24,true],"profile_48":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-48x48.png",48,48,true],"profile_96":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-96x96.png",96,96,true],"profile_150":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-150x150.png",150,150,true],"profile_300":["https:\/\/thegood.com\/wp-content\/uploads\/customer-loyalty-program-300x300.png",300,300,true]},"post_excerpt_stackable_v2":"<p>Key TakeawaysBy the end of this article, you should have the knowledge and resources to \u201ccheck the box\u201d in these areas\u2026How to turn your one time customers into brand loyalists through an engaging loyalty programUnderstand the importance of loyalty programs in a growing ecommerce businessThe structure and format of winning ecommerce loyalty programs from top brands The surge in online shopping, the rise of small ecommerce businesses, and the constant change of consumer preferences are just a few of the reasons ecommerce sales landed at a whopping $4.9 trillion in 2021.&nbsp; And the industry isn\u2019t stopping there with sales expected&hellip;<\/p>\n","category_list_v2":"","author_info_v2":{"name":"Caroline Appert","url":"https:\/\/thegood.com\/author\/carolineappert\/"},"comments_num_v2":"0 comments","yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.7 (Yoast SEO v26.7) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How To Build 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