Who doesn't love free stuff? I often seek out stores that offer a loyalty program. The more I shop with their company, the more I am rewarded. Win-win, right?
You may leave money on the table if you haven't established a loyalty program for your e-commerce business. Loyalty programs are mutually beneficial for both you and your customers. Build a program that allows customers to earn referral credits, feel welcomed and valued, and encourage repeat sales.
Customers who love your product will want to share it with others even without being rewarded. However, if customers know they could earn rewards for sharing their experience, they are more likely to do so. According to Hubspot.com, 71% of people are more likely to buy from social media referrals. With this in mind, we need to ensure customers are sharing about your product and their experience. Rewarding them for doing so will encourage them to keep sharing.
Welcomed & valued
Take note of special dates such as a customer's first purchase anniversary or birthday. Add an extra stamp or points to their punch card when the particular date arrives. You have often recorded this date or allowed your system to do this for you. Your customer will feel valued when they realize you were thinking of them.
When I receive an email from my favorite stores with a coupon to shop around my birthday, it always makes me feel extra special.
A loyalty program will remind shoppers the more they spend, the more they will earn rewards. In addition, creating tiered rewards will keep them working towards the next freebie or discount code. However, when building your tiers, ensure they are attainable and worth the money spent. For example, spending $500 for a $5 gift card may entice a few, but I imagine not many.
Structuring the program
First, decide on the reward type, such as punches, tickets, or points. Then, how will your customer earn said reward type? Is it the number of orders? The number of items bought? The dollar amount spent?
(ACTION) X Frequency = (Reward Type)
After you have decided on what action equals what reward type, such as points, you will need to choose how many reward types they require to earn the payout.
(Reward Type) X Frequency = Payout
Let's review an example below:
- $1 Spent = 1 Point
- 200 Points = $20 Voucher
- So, for every $200 spent, the customer will earn $20 in the store.
Put into action
Once you have decided on your program structure, you can add additional ways to earn points.
Consider the ideas below:
- 5 points - Sign Up for the Program
- 5 points - Refer a Friend
- 10 points - Birthday
- 10 points - Game Winner
You can have fun with points and get even more creative to leverage your program for more sales. For example, consider offering a Double Points day. All orders placed on that day will earn double the points.
Remind customers to come back into your shop by posting and tagging those who have above 200 points and remind them to cash them out. If there are customers that are close but have yet to hit 200, tag them and encourage them since they are close.
Set up Smile Rewards on your Shopify website to run your loyalty program. Everything you need to start is FREE! The free tier includes a points program, referral program, basic branding, default reward emails, analytics overview, and up to 200 monthly orders. If your business outgrows the free version, take a look at the additional tiers below:
Starter = $49/month
- Advanced branding
- Customize reward emails
- Remove Smile Branding
- 1 Smile App integration
- Unlimited orders
growth = $199/month
- Nudges (engaging Pop-Ups)
- Points expiry
- Advanced analytics
- 2 Smile App integrations
- Unlimited orders
pro = $599/month
- VIP Program
- Shopify Plus exclusive features
- Unlimited Smile apps
- API access
- Unlimited orders
At first, a rewards program may only seem beneficial to your customers. However, many of our businesses are held up by the same core repeat customers. Creating a loyalty program will only reinforce your appreciation and keep them returning.
If you have worked through creating your loyalty program with the ideas listed above, setting your program up will be a breeze.