9
 min read

5 Proven Customer Loyalty Programs That Work

You want to create your own loyalty program but you are not really sure what you could offer to your loyal customers? Discover how the bigger brands out there have created and why it works like a charm.

You've heard it before, and you'll hear it again: keeping your customers happy means they're more likely to keep buying from you, which means you're more likely to be profitable. 

Customer loyalty programs can seem like an easy win in a world where customers are always looking for the best deal but implementing them isn't as simple as it might seem at first glance.

The good news? You don't have to create something completely original to create a great customer loyalty program that works.

While there are plenty of ideas about how to do this, there are some tried-and-true ways to ensure customer loyalty. 

What Are Customer Loyalty Programs?

Customer loyalty programs are proven to create more loyal customers, but most small businesses don't use them because they're a lot of work. 

But what are customer loyalty programs, and why should you care? 

For your business to succeed in today's competitive market, it needs repeat customers who repeatedly return without fail. 

Your best source of new customers is the existing ones. Repeat customers will spend more money than new ones because they have already developed trust with your brand and know what to expect from your products or services. 

This is where customer loyalty programs come into play. 

A customer loyalty program is an incentive that rewards loyal customers for their repeated patronage of a business by giving them discounts or special offers on their next purchase or purchases.

Customer loyalty programs offer discounts, special offers, and VIP events to encourage repeat purchases. There are many types of loyalty programs, from simple stamp cards to complex point-based reward systems, but all are designed to retain customers.

With a well-designed loyalty program, you can:

  • Expand your customer base.
  • Maintain customer loyalty.
  • Activate dormant customers.
  • Make them spend more by nudges.

How Do Customer Loyalty Programs Work?

Loyalty programs work by rewarding customers for performing specific actions, such as making a purchase. The rewards can take many forms: cash back, points for future purchases, or other benefits. 

The more customers shop at one store, the more rewards they'll earn and thus increase their level of customer loyalty. 

These programs have become popular among businesses because they provide companies with valuable information about their customers. 

According to Accenture, more than 90 percent of companies use some form of customer loyalty program. It was also reported that 84% of consumers are likely to stick with a brand that offers a loyalty program. And 66% of consumers say that earning rewards changes their spending habits. Over 95 percent of customers reveal that trusting a brand increases their loyalty, according to Salesforce. 

As a bonus, customer loyalty programs allow companies to reward loyal shoppers without spending much money.   

Types Of Customer Rewards Programs

There are many different types of customer loyalty programs. These types of rewards programs differ based on what they offer to customers but can be grouped into three categories: 

●     Discounts, 

●     Rewards, and

●     Recognition. 

Let's take a look at some of these rewards. 

Customer Discount

This program gives customers access to discounts when shopping in stores or online. Customers earn points for every dollar spent that can later be redeemed for money off future purchases. Many retailers also use digital coupons as part of their rewards programs because they are easier to distribute and manage than paper coupons. 

Rewards Programs

A rewards program is any system that allows customers to earn points towards a reward. Some companies have started rewarding customers not just for buying their products but also for referring new ones. They might do so through email campaigns or social media platforms.

Recognition Programs

Recognition programs work differently than other types of reward programs. In these cases, customers don't receive anything tangible. Instead, they are rewarded with a letter or certificate thanking them for being loyal to a company. 

There are still benefits to participating in a program. First, it makes customers feel good about themselves and encourages them to continue buying from that brand. Second, it helps build trust between customers and businesses—people like knowing that companies appreciate their business and want to show gratitude.

5 Proven Customer Loyalty Programs That Work

Here are five proven customer loyalty programs that work, so you can get your business off on the right foot with your customer loyalty program without losing money or time.

  1. Starbucks Rewards Loyalty Program

    One of the most prominent customer loyalty programs is that of Starbucks. For every dollar spent, customers are awarded two stars. After enough stars accumulate, customers can obtain free beverages, food, and other goods to reward their patronage. 

    This rewards program also includes special offers only available to its members. Starbucks Rewards Loyalty Program makes it easy to become loyal to one coffeehouse, encouraging people to return more often.

    However, customers need to purchase coffee with the app to earn points (or stars for Starbucks). This way, Starbucks has access to tons of personal information about you. They know what you like to drink, how much money you're worth, the drinks you prefer during certain seasons, and where you frequently visit.
  2. Sephora Beauty Insider Program

    Beauty Insiders make up 80 percent of Sephora's annual sales, making it one of the most popular loyalty programs in the world. This free program gives members exclusive access to special deals, product samples, online coupons, makeup tips, tutorials, and a birthday gift each year. 

    The best part? You can earn points (called Beauty Insider points) that are redeemable toward future purchases. It's a traditional point system where you earn rewards with each purchase, but with this customer loyalty program, they can choose how their points will be used.

    The price of Sephora products is one barrier for many customers. Members of the Beauty Insider program can redeem their rewards points for items like gift cards and discounts, allowing them to offset purchase prices without diminishing the overall value of the products. In addition to limited edition products, loyalty members can also get in-store beauty tutorials using their points.
  3. Amazon Prime

    Amazon's Prime Membership
     is one of many lucrative cash-flow methods for the eCommerce giant, struggling to face competition from department stores such as Walmart. 

    The small amount paid to sign up allows Prime Members up to two-day shipping at no additional cost, along with plenty of other bonuses like expedited order processing and pre-release deals galore during the shopping season.

    Though Prime offers advantages that can't be found at other retailers like Walmart and Costco, there are many similarities across the board. Which is why Amazon must work even harder to maintain its customer base while finding ways to separate itself from its competitors.

    Customers who participate in a prime membership-based loyalty program will often spend four times more than those who don't want due to its incentives. It's important for businesses that operate in industries where product choices and prices are similar among all competing entities. Giving customers something they simply cannot find anywhere else gives them the incentive to stay loyal only to you (which leads to increased business).
  4. The Body Shop Loyalty Club

    Known for its commitment to charitable work and customer service, The Body Shop is an international chain of beauty stores that puts the customer first. The company operates on a shop-more-to-earn-more basis but also functions like an online community where members are encouraged to do good and earn rewards points.

    The store's loyalty program mission is focused on inclusion - which isn't typical among other chain stores - and functions as a shopping tool and an outlet where people can share ideas. 

    With each purchase made in-store or online, members receive points that eventually add up to cashback. They're given coupons throughout the year, invitations to member events such as parties, birthday gifts worth $10 off, or even donated without charging anything when items are purchased specifically for others through charity gift cards given out by the company. It's hard not to love this fun take on customer service.
  5. The North Face

    The North Face's Apparel and Outdoor Gear retail company encourages frequent customers to earn more and more rewards by allowing them flexibility in how they're redeemed. Their membership is customized to match their lifestyle, and you even receive points every time you purchase or do things that they don't even sell yet! You can check in at your favorite The North Face stores or other partner locations, download The North Face app, and much more.

    You can redeem these points for travel experiences like a mountain climbing adventure in Nepal when it's time to redeem rewards.

    More than just selling blind products to customers, The North Face Rewards make them feel an emotional connection with the brand when the customer doesn't just receive a product. Also gets to go on a sponsored hiking trip in Alaska and have their needs met in a personalized way that wouldn't be possible for a small retailer.

Best Way To Go About Your Customer Loyalty Program?

Be unique with your customer loyalty program by working with Yollty Loyalty and Marketing Automation System. 

Yollty allows you to leverage your existing customer base and ensure that more people sign up as your company's customers. 

If you run a restaurant business and want to retain more customers, you may consider rewarding them with Yollty for several reasons. 

Yollty makes it easy for you and your team to manage all aspects of your rewards program – from signup to participation, redemption, and review. You can create an effective loyalty program in minutes with its simple design and robust features. Plus. 

With the Yollty digital loyalty card, your loyal customers are rewarded for every purchase they make at your store. Customers can claim gifts they can use to shop at your store when they download the Yollty application. 

A detailed knowledge base, 24/7 support, and a flexible pricing plan make Yollty one of the best customer loyalty software platforms.

There's nothing as sweet as giving your customers a tangible reason to shop with you again after an amazing experience and rewards that show you appreciate them. 

Conclusion

Now that you have read about all of these rewards programs, you should be able to see why customer loyalty programs are essential for businesses. Customers who feel appreciated are more likely to continue buying from that brand. These rewards also help build trust between customers and companies because they show customers how much a business values them. In addition, these reward programs make customers feel good about themselves and encourage them to continue shopping with that company. If your business doesn't already offer some type of customer rewards program, then you should consider starting one. It can benefit both your customers and your bottom line.

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