5 Examples of Creative Loyalty Programs (and Why They Work)

By now, you probably know all about how effective loyalty programs are.

The problem is, so do all the other marketers in your industry.

As a result, there are tons of loyalty programs out there right now - so many in fact that your average customer is going to be participating in 14 programs on average. While staying active in only half of them.

It thus leads to a paradox, where the programs which are supposed to be useful become so widespread that they end up being trivialized for the customer and turn into a rather expensive discounts giveaway for the merchant.

So does it mean that you should give up on loyalty programs?

Of course not. After all, loyalty programs are pretty useful. What's important, though, is to make that program count by creating it about something more than mere bonuses - such as experience, personalized service, or customer's social values. With Growave, you can customize your loyalty program.

So to see how that works, let's take a look at five examples of creative loyalty programs that stood out with their practical design. In so doing, we'll see what it was that made them click with the customers and how you can apply that in your program.

Let's dive in!

1. Chipotle's Chipotle Rewards - or a program with a purpose in mind

Chipotle Rewards is a pretty classic but worth noting loyalty program. Like many others, it offers a free product once the customer hits a specific point threshold and celebrates their birthday with a gift. It also provides extra points for purchases made on certain days and multiplier bonuses for trying new items on the company's menu.

Why we loved it: the program's design is quite thought-out and hits several goals at the same time:

• Retention - the free item reward helps to motivate the customers to keep buying from the brand;
  Brand's reputation - the birthday gift works to improve the brand's image and its relationships with customers;
  Revenue - the extra points on special days allows to strengthen the brand's revenue on the slowest sales days;
  Engagement and Loyalty - the "switch it up" bonus for trying new items helps the brand get its customers to try more, increasing their likelihood to find new favorite dishes and thus stick with the brand longer.

Takeaway: you can get more benefits from your loyalty program if you design it accordingly. For that, consider first what you'd like to achieve with your program and then integrate those goals into the project.

2. Sephora's Beauty Insider - or giving the customer a valuable experience

A luxury cosmetics brand, Sephora, is well-equipped in the way it crafts its loyalty programs.

For one, it doesn't offer discounts, as for a luxury brand that would rather work to cheapen its image than help. Instead, the program provides a valuable experience for the participant, such as via free beauty classes, custom makeovers, or access to the insider community. Another great thing to mention is the Rewards Bazaar, which enables the customer to choose the reward to their liking among various options. In turn, it gives the participant a feeling of freedom and control over what they get.

Why we loved it: together, all of these elements work to reward the customer with a meaningful experience rather than a money-based reward. As a result, this helps create a memorable interaction with the brand for customers, which fosters better customer relationships and long-lasting loyalty among the customers.

Takeaway: consider including experience-based rewards in your program. It can take the form of certain events, community access, or helpful courses and readings. You can also try offering various tips to choose from to have more significant freedom of choice.

3. Uber's Uber Rewards - or offering premium-quality services

Close to Sephora's Beauty Insider program, Uber Rewards focuses on providing intangible, experiential rewards. In their case, it takes the form of offering premium-quality services to the company's most loyal customers. These services include price protections from rush hour price surges, flexible cancellations with full refunds, and priority pickups at airports.

Why we loved it: the intangible aspect of the rewards - in that it is something that cannot be bought - works a great way to increase the value of such rewards for the customers. It also helps them feel more exclusive once they participate, which ups the program's value and makes the customers more loyal to the brand.

Takeaway: Consider using premium services as a way to reward your customers. It will even cost you less than a traditional discount so that it might be a better option for both budget-wise and in terms of effectiveness.

4. The Body Shop's Love Your Body Club - or lacing your program with deep social meaning

An ethical beauty products company, The Body Shop is excellent at integrating its programs into the brand's bigger mission. They do it by allowing the customers to donate their rewards from purchases to many of the brand's partner charities.

Why we loved it: the program kills three birds with one stone:

1. Its charity-oriented nature solidifies the company's image as a socially conscious brand.
   It also co-opts the customers as a part of that, enabling them to support the cause they care about through their actions and association with the brand. In turn, it makes them more likely to participate in the program, thus increasing their engagement and conversions.
   It also makes the customers more loyal to the brand, as they continuously see it reflect their values and resonate with them.

Takeaway: consider including socially conscious elements when designing your loyalty program. As we've seen, this can have multiple benefits, though for them to work, your program needs to come across as authentic first and not just sales-driven.

5. Annmarie's Quizes - or giving a customer a personalized and interactive experience

This one is not a loyalty program per se, but its structure was so well-designed that we couldn't help mentioning it.

So the thing about Annmarie is that this skincare brand runs a variety of quizzes for its customers. These generally help them find a product they want or learn more about their skin type.

So besides being informational and interactive at the same time, this quiz also works as a great promotional and loyalty-driving opportunity.

For example, once the customer finishes the quiz, the brand offers them a set of personalized recommendations based on their result: a sample product kit, an article to learn more about their skin type, and a custom product recommendation with a discount code.

Why we loved it: this program works as a brilliant exercise in driving customer's engagement - it's interactive, helpful and gives the customer a money-saving offer. Furthermore, the personalized result makes the product recommendation feel more like an organic and valuable part of the program rather than a pushy and over-selling offer.

Together, these elements thus work to create actual value for the customer, making it a great example of a rewards program.

Takeaway: consider combining your loyalty program with other marketing elements. Whether it is a quiz or an article, such features will help your program feel more organic and helpful rather than sales-oriented.

Wrapping up

As we've seen, there's a plentiful variety of ways to approach your loyalty program. The specific choice will thus depend on your industry, goals, and personal preferences.

As a general rule, however, we've seen that nearly all of these programs had one thing in common: they all offered something more than a simple transaction. Thus, whether it was a valuable experience, personalization, social meaning, or premium services, all of these examples tapped into the basic human needs - such as the need for connection, a more significant purpose, or a feeling of exclusivity - and answered them.

With this in mind, we hope that creating an effective loyalty program will become a more straightforward process for you. In the meantime, stay tuned, and thank you for reading.