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Loyalty Programs are awesome that's why they’re everywhere! Are they worth it? Are they a good fit for your business? Let’s find out.
There are tons of loyalty programs out there right now - so many that your average customer participates in about 14 programs. Of those loyalty programs a shopper is expected to use only half of them. This means there is an underlined issue that we need to identify!
When the meaning of loyalty programs is misunderstood, they fail to accomplish their goal and end up as expensive giveaways.
So does it mean that you should give up on loyalty programs?
Of course not. After all, loyalty programs can be game-changing. What's important is how you make that program count. This article will give a few cases when a loyalty program may be useful and 12 examples of great loyalty programs that successfully elevate beyond the typical. They’ve managed to create something more than basic bonuses - with meaningful experiences, personalized service, or social values.
When should you start an e-commerce loyalty program?
- When the economy slows: around times of economic instability, when many expenses suddenly become luxuries, loyalty programs can help alleviate some of the burden. Loyalty programs are designed based on customer purchases and history and are programable to be very stable solutions. The longer you’ve been using them, the more impactful they can become as you collect more members. They can also help maximize value from your active customers and give you all the tools to handle visitors.
- When you’re trying to save on expenses: loyalty programs are a very inexpensive solution with some major upsides. Most loyalty programs come as complete subscription apps that are easily installed into your e-commerce store. They often have numerous tools that you can leverage to complement your goals. Conversions are generally low in e-commerce and having a rewards system can make it competitive for you when customers compare options.
- When you want to build a customer base: Having a targettable customer base is deeply undervalued. Finding new customers can often be difficult and expensive, and loyalty programs are ideal for attracting, managing, and retaining customers. We also see e-commerce businesses face difficulties extracting the maximum value from their customers, which loyalty programs can help with rewards and other incentives. Rewards can be used to encourage referrals, reviews, and social sharing; all possible sources of high-quality leads.
- When you're trying to gain traction at startup: At early stages an e-commerce business can be especially vulnerable and a loyalty program with highly engaging rewards can give your store that boost you need to get off the ground. If successful, every new customer to your loyalty program can be an advocate for your brand which can set you on the right path for growth. Rewards can be used to target reviews and program registration, two very important early goals to enable such goals.
- When you want to amplify or substitute paid ads: paid ads are a powerful source of leads in e-commerce, but many would consider them expensive, often seeking alternatives. Loyalty programs as conversion and retention tools, can support your paid ads by increasing your conversion potential. Driving leads to your e-commerce store can be expensive and sometimes those leads may produce high bounce rates. With incentive-driven rewards, we are able to improve our ability to capture and retain customers to stretch their value.
- When you are trying to reclaim lost customers: The past is a great source of proven value. We have seen numerous examples of businesses that had been in operation for years that had customers who were effectively ignored. It wasn’t until they realized how many customers they’ve let loose, that they decided to reclaim that hidden value. They didn’t know just how many customers were open to the idea of a loyalty program. A strong loyalty app provides an active connection to customers and a means of reaching out to them.
- When you are looking for more control: Control is a major issue in e-commerce commonly seen with new companies. Loyalty integrations elevate the user experience but more importantly, they create better more influential marketing tools. These tools give you the ability to implement countless variations using numerous options. The main message here is how these tools can enable you to create incentives, which may be difficult with alternatives like universal discounts.
- Building a brand identity and extending your product: The most creative loyalty programs create deep value for customers that is capable of elevating your brand. Differentiating your business is a struggle and having the means to create a relationship with shoppers and to keep that bond strong long-term is a strategic victory. Below is how 12 brands created this effect!
12 Examples of Customer Loyalty Programs
1. Box Raw
One of the cleanest, sweetest deals around is the Black Card by Box Raw.
It's stylish, desirable, and really well-built. This loyalty program combines awesome rewards and great presentation. The Black Card covers everything you need, so it would be a wise example to follow. Box Raw tops this list for its sleek design and completeness.
Why we love it:
- Their visuals are stunning
- Their widget is flawless
- Their program is loaded with perks
- The program is simple to use and well-explained
Elevated Experience with Widgets:
They have a widget that falls seamlessly onto your page. Shoppers have a easy way to access their benefits without having to leave the page. This improves the page's overall functionality and user experience. Widgets are a great idea and could prove to be a key component of your customer loyalty program.
Just like in most competitions, we use precious metals to define classes, and this fitness brand successfully relates to the culture. Box Raw recognizes its customer base and these small things really add up, and the sound of “Black Card” is low-key awesome. Besides the clever design, their tiers are loaded with perks and the rewards are really engaging.
Clear and Instructive:
The way that Box Raw explains the process and demonstrates the benefits is outstanding. They make their program clear and simple. Style and layout is an important element that can help cultivate a positive impression. Remember that the clearer your message, the simpler the decision.
Progress Bar and Free Points:
Box Raw offers hundreds of points before you even make your first purchase and tracks your milestone until your next upgrade. You can easily tell where your progress meter rests and the sort of perk you will receive at each stage. Another reason why the Black Card is winning on customer appeal.
Complete FAQ Section:
Box Raw features a complete FAQ section for its loyalty program, making it easier to find the answers you're looking for. Apart from the benefit it has for the customer, a FAQ section can alleviate some of the stress from customer service; squashing the issue before it buds.
Nike is unmatched in consumer engagement because they extend their loyalty program into lifestyle. The name is reputable, the consumer base is massive and the community is interactive. Nike checks all the boxes for loyalty program excellence. Let’s break it down why.
Why we love it:
- The Nike loyalty program focuses on lifestyle and community
- They provide one of the broadest options for rewards and exclusive offers
- They build ways for customer to enjoy their products through activities
- They offer a whole suite of apps that complement their core product line
Great Communication and Community-Centric:
Loyalty programs need encouraging rewards to be effective. Nike has some of the best rewards on our list because they know exactly what customers enjoy and are able to create extended value for their products. You can tell that they have successfully built a community of loving shoppers and found great ways to retain them. These sorts of engaging rewards work to complement your products and give them purpose.
A Complementary App Suite:
The apps that belong to the Nike suite are all about extending the utility of their products into lifestyle and community. They provide a highly interactive and engaging experience to their already massive customer list. Their product is built around fitness and their loyalty program focuses on the same message.
Lululemon is a brand built around recognition and self-betterment. To prove their caring they had to build value in ways that went beyond their in-store experience. What really honed this brand's message was its pivot towards loyalty membership. They’ve introduced benefits that extend beyond ordinary discounts, offering studio workout sessions and recorded routines. That’s some progressive thinking! Keeping active is how they keep their customers coming back and that is the difference maker.
Why we Love it:
- Lululemon tries to build a culture of health with its loyalty program
- They embody their lifestyle by giving you a place to use their products
- They made highly desirable rewards by knowing their customers' intention
4. Massimo Dutti
FEEL provides a one-of-a-kind experience; a memorable and deeply sensational loyalty program. You can almost smell the leather through the computer screen. There is a sense of exclusivity and a strong connection between loyal shoppers and the product. They focus on quality and exclusivity as the foundation of their program.
Why we love it:
- They cultivate a sense of exclusivity for their dedicated customers
- They speak to their customers on a subliminal level and understand their reasons
- They make their customers feel special by making them stand out as special
This particular program is definitely non-traditional, but it serves as an amazing example of creativity at play. They make a promise of exclusivity and first-class service. They also provide all their members with early access to discounts and limited edition items. They also incorporated events by offering special access and private visits. This would seem like a natural focal point for a luxury brand.
Special Treatment and Exclusivity:
For a luxury brand, customers have different expectations. They have the money, what they want is exclusivity and special treatment. Massimo Duttiy successfully identified the particular preferences of their dedicated customers. Although their program is not as interactive as other loyalty programs in this list, they have taken a less traveled road which is something their customers happen to enjoy.
Chipotle Rewards is a return to the standard loyalty program, which seeks to reward consistent consumers. Chipotle has a strong retention power which guides their loyalty program and proves its utility. This sort of program is primarily focused on the customer experience. Amongst the several rewards, 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 Love it:
- Free items are a great bonus for loyal customers because it is a very direct way to improve customer expectations.
- They promote menu diversity by giving more points for trying new items, which we consider a clever way to meet a managerial goal.
- It’s clear that the purpose of this particular loyalty program is to promote their organizational goals. Which makes it mutually beneficial for business and customers.
6. Sephora's Beauty Insider
A luxury cosmetics brand, Sephora, is well-equipped in the way it crafts its loyalty programs.
For a luxury brand, it’s important to maintain the value of your product, and discounts can cheapen customer perception. Instead, the program focuses on experiences, such as free beauty classes, makeovers, and an 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 participants freedom and control over what they get.
Why we love it:
- Sephora romanticizes its relationship with customers, delivering dreams and experiences
- They enrich their image by offering a feature-loaded program with endless rewards and great progression
- They avoid making their program about discounts and preserve the value of their brand and products
7. Uber's Uber Rewards
Uber Rewards being one of the first ride-hailing apps in the market has successfully retained their customer loyalty with reward progression. While they do not necessarily offer major discounts, they offer rewards that improve their customer experience and satisfaction scores. Notable services include price protections from rush hour price surges, flexible cancellations with refunds, and priority pickups at airports. It would seem like Uber hears what customers want and implements feedback to improve their rewards.
Why we love it:
- Uber is a popular improvement to city life and has become central to people's lives, almost to a level of dependency. They have implemented a loyalty program that rewards loyalty and makes it fair for users
- The rewards, although non-financial, create a clear benefit for customers with excellent progression in rewards
- Since rewards are functional, they improve the usability of their app and customer satisfaction as well
8. The Body Shop
As an ethical beauty company, The Body Shop does well to mix its brand into its loyalty program. They do so by allowing the customers to donate their rewards from purchases to many of the brand's partner charities.
Why we love it:
- Their rewards are charity-oriented, which solidifies the company's image as being socially conscious. It also co-opts the customers as a part of that image, enabling them to support the cause through association
- They have a clear idea of who they want their customers to be and speak to them directly with their rewards, crystal clear communication
- They use their loyalty program to provide assurance in their values and to enforce their commitment to their values
9. H & M
H&M is a major global brand with a huge customer base, but it’s not so simple. There is a lot of competition in apparel and one of the keys to success is customer loyalty. It’s obvious why H&M puts so much effort into its loyalty program. They’re a prime example of a loyalty program, so let’s probe the reasons why. There are numerous special touches that H&M uses that elevate their loyalty program to another level.
Why we Love it:
- They did very well to build a sense of exclusivity, offering features only available to a specific group of members.
- They made it rewarding to enroll with a first purchase reward.
- They have a mobile app, a major factor.
- They used their loyalty program to push their strategic goals.
Focus on Customer Satisfaction:
H&M is already a household brand and this loyalty program is low-impact and all benefits. They used a few clever tricks to push the needle in their favor, making the online shopping experience as good if not better than the in-person experience. Not only are the perks of membership worthwhile, it isn’t very difficult to acquire “Plus Membership”. Is the H&M loyalty program worth it? Yes! 10/10.
Shoppers in general love exclusivity, limited editions, and special offers. Programs that offer these sorts of elevated experiences, go above and beyond your average loyalty program. There is a meaningful treat for dedicated shoppers and this makes it worthwhile pursuing the “plus” membership. This goes down as one of those programs that are really about the loyalty members.
Mobile App and Clear Instructions:
Another major factor about the H&M loyalty program is the Mobile App. Customers adore an easy shopping experience. There is no better improvement to the shopper's online experience than mobile apps. Overall, this is a program worth checking out for inspiration.
Mango successfully takes a unique spin on the classical loyalty program. Nothing is ordinary about this program. It gives off a humane and caring impression, true to the meaning of real loyalty.
Why we Love it:
- They have the most unique and encouraging rewards; donations to NGOs, free music, and cinema tickets. Outside of the typical theme entirely.
- The first brand we’ve found that puts sustainability into their program. You can collect points by recycling old clothing, something no one else is doing on this list.
- They successfully made a warm and outstanding loyalty program with their “likes” and features.
Cinema lovers will agree that an AMC loyalty program is a must-have. Movies fans can appreciate how awesome this program is. It just makes perfect sense that your favorite local theater should be thinking about you between visits. AMC offers some of the coolest perks for cinephiles. They treat loyalty members with real priority and create a really exciting offering at each tier.
Why we Love it:
- Loyalty Programs for services are uncommon and this puts a smile on our face.
- Membership is a super easy choice, it makes the overall movie-going experience better.
- This lands right at home for movie lovers and makes it an easy and fun occasion every time.
12. The North Face
The North Face brand has always been associated with nature and durable cold-weather clothing. It was important for them to represent their cause and that's exactly how they made their loyalty program stand out for us.
Why we Love it:
- They have an “actually” worth it mobile app, which gives its users special access to parks and monuments.
- They encourage bringing in your own reusable bags to shop and even reward it with points.
- They allow field testing of your purchase and even offer exclusive products.
The examples above demonstrate the best qualities of the best loyalty programs in e-commerce. By now you should have a vivid idea of how to build your own customer loyalty program. There is so much value in e-commerce and more so in customer loyalty. Many underestimate the value of loyalty programs, but there is so much untapped value in building bonds and creating lasting impressions. We believe that true value is found in customer loyalty and we also consider it to be a universal goal for any business.
Growave can help you build a dynamic and engaging loyalty program, and drive customer retention. Every one of the examples given above can be built with a robust integration like Growave. If you're interested in implementing your own unique loyalty program, we encourage you to get in touch with one of our representatives or check out the official Shopify app store for more.
Frequently asked questions
Can you brand your Loyalty Program?
Branding is an essential, all loyalty programs should have the ability to customize your program. This could mean any number of things like, naming your rewards, the rewards you choose or the way the app features in your store. Always opt for a program that offers customizable features.
How do you install a Loyalty Program?
Loyalty programs usually have a short onboarding process that jump-starts your program. Afterward, you have unlimited access to an admin panel to control the details of your program. With Shopify all you need to do is install the app and follow the on-screen instructions. You should expect analytics, branding, emails and multiple other features when you install a loyalty app.
How hard are Loyalty Programs to manage?
Modern Loyalty Programs are built with users in mind. They Require some basic math, a good program will have clear instructions and an easy-to-use administrative panel. You should look for a program with a modern admin panel and organized settings.
How do you optimize your Loyalty Program?
It may be worthwhile to assess your customer base and competitors before choosing which rewards to enable. There isn't one clear answer, but depending on your objectives you may find certain rewards more valuable, such review rewards for social proof or follows on social media. You can also control your point values and which products to discount to improve turnover rates. Branding and exlcusivity have shown positive effects on customer interactions. There are multiple ways you can find an advantage.
What are the benefits of Loyalty Programs?
They are linked to lower customer acquisition costs, increased average order value, and lifetime value of customers. They are considered robust ecommerce marketing tools. Loyalty programs are also databases of all your members that can be used in combination with emails to re-market shoppers.