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How to Build a Loyalty Program

Customer loyalty directly impacts the success of your businesses. Turning first-time customers into lifelong ones should be every entrepreneur’s goal and unlike the days of old, providing quality products and excellent services for fair prices isn’t enough to earn the loyalty of your customers. Nowadays, having a positive shopping experience is what keeps customers coming back to a store. So how can you ensure that your customers have a positive experience?

On this side of 2020, the answer is unanimous across every industry—a loyalty rewards program.

The #1 way to improve customer experience and satisfaction is to implement a loyalty rewards program at your store. If you’re unfamiliar with what a loyalty program is, we recommend that you take a moment now to read What Is A Loyalty Program? This article is part of our covering your bases series: Why Is Customer Loyalty Important, Loyalty Program Types, Best Loyalty Practices, and How Much Does a Loyalty Program Cost? It’s all good reading and every article pairs nicely with a glass of wine.

A loyalty rewards program will positively enhance your customers’ shopping experience, but why?

Customers who are offered special opportunities to save money feel valued. A strong loyalty program offers discounts, rebates, redeemable points, free merchandise, coupons, and access to unreleased products and services.

While it might sound like you’ll lose money with so many discounts and freebies flying around, don’t worry. That’s never the case.

Strong loyalty programs that are built and executed properly yield a high return on investment, or ROI. Statistically speaking, it costs roughly 5x more to acquire a new customer than it does to retain an old one. Depending on the cost your business accrues to attract and acquire that new customer, you could be losing money every time a new customer doesn’t become a lifelong one. Think about it. Let’s say you spend $10 to acquire a new customer. You’ve got ads running on Facebook and Instagram. You invested in Google AdWords. You might even have a twenty-second spot on the radio to advertise your business. But what if that expenditure only returns $10 per first-time customer, because most first-time customers who enter your store go for that $10 dinner or $10 tee-shirt? Do you really want to break even?

Of course not. What you want to see after spending $10 to acquire a new customer is their smiling face shopping in your store multiple times a week. A $10 investment is dirt-cheap if that customer ends up spending $3,000 in your store over the course of their lifetime. Even if they only end up spending $100 over the course of their lifetime, that’s still a healthy ROI.

A loyalty rewards program that is built badly is just as ineffective as having no loyalty rewards program at all. Sorry, kids. That’s the cold, hard truth and we respect you enough to give it to you straight.

You need to build your loyalty rewards program in a way that incentivizes your customers to shop frequently because it rewards them often, and we’re going to literally show you how.

We’ve already gone through the different types of loyalty program types, so we aren’t going to go over that information here. We’ll assume you know it already, but if you don’t, take a moment now to give it a read so that you understand the terminology we’re using.

Choose A Loyalty Rewards Program That Has Mobile Capabilities

Consumers love social media for a reason. It’s entertaining. It’s engaging, and it’s at their fingertips. That’s where you want your store to be—in front of your customers’ faces, under their noses, and at their fingertips—which means that your business and brand needs to be represented digitally, easy to access, and fun every time your customers tap open the app.

Nowadays, people rely on their mobile phones for savings. Smartphones aren’t just a source of entertainment. They also provide a sense of community. Choose a loyalty rewards program that comes with an easy-to-use app. This way, you can send your entire customer base push notifications to alert them to new point-based deals and discounts. You can also send messages, and your customers can even add their friends, create groups, and interact with each other for a fun, convenient sense of community.

Choose A Loyalty Rewards Program That Gives You Full Control To Design Your Promotional Campaigns

The paper punch-cards of yesteryear and those plastic scan cards of old are doing you and your business absolutely no favors when it comes to offering your loyal customers eye-catching and exciting deals. So be sure to choose a loyalty rewards program that provides a comprehensive digital platform where you can build your own promotional campaigns. There’s just one caveat…

Are you really doing yourself any favors if you choose a platform that’s so advanced, you have to enroll in a graphic design course just to know how to navigate around the backend? Probably not. Pick a loyalty rewards program that offers pre-designed templates as part of its digital platform. It will save you time in the long run.

Choose A Loyalty Rewards Program That Allows You To Interact And Engage With Your Customers Through A Digital Platform

This is the whole reason you need to be sure to choose a loyalty rewards program that has mobile capabilities—you need to get into the habit of engaging your customers. Your customer’s birthday is today? Send them a happy birthday message! Your customer is just 20 points away from earning an item they’ve “favorited”? Send them an encouraging message to let them know that! Haven’t seen a certain customer in your store for a while? Send them a message to tell them you miss them!

We hope you’re spotting a theme here…Message, message, message! Engagement is key. You want your customers to move in and out of your app just as easily as they do any other social media app on their mobile phone. This way, while your customers are using the app to interact with their friends, check out deals, and scroll through the alerts you’ve sent them via push notifications, they will start to feel like you’re part of the family!

Building a loyalty rewards program that works for you instead of the other way is imperative, but try not to get overwhelmed. We recommend that you comb through the rest of this series, take notes, strategize… unless that sounds overwhelming, too. If so, just give us a call. The loyalty strategists at Loyal~n~Save can handle just about everything for you, so click here for our contact page.


  • Loyalty Rewards Program
  • What Is A Loyalty Program

Posted on May 5, 2020


Danielle Dixon

Danielle is a content writer at Loyal-n-Save. She specializes in writing about implementing loyalty solutions proven to help a company grow.

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