Ecommerce Loyalty Programs: Why You Should Consider Using it? (Ideas+Examples)

Ecommerce loyalty programs helped Sephora reduce its customer churn rate by 10%.

This success story shows why many online shops are trying out similar programs. They’re always looking for clever ways to acquire and retain customers.

Reward programs are turning out to be a really good way to do this. A loyalty program in eCommerce increases the likelihood of over 70% of consumers recommending a brand.

In this blog, we will explore the importance of loyalty programs for eCommerce businesses, why they should consider implementing one, best eCommerce loyalty programs, and some best loyalty program ideas to get started.

What are eCommerce loyalty programs?

An eCommerce loyalty program is a marketing strategy that eCommerce store owners use to reward their loyal customers. These programs includes rewards like,

• Points for each purchase
• Exclusive discounts
• Early access to sales
• Free shipping
• Free products

For example, Amazon Prime is a famous eCommerce loyalty program. It offers free shipping and other benefits to members who pay a yearly fee.

Importance of Loyalty Program for eCommerce Business

Top reasons to understand the importance of loyalty programs in eCommerce businesses:

1. E-commerce Loyalty Program Builds Reputation

A well-executed loyalty program establishes a positive reputation for an eCommerce business.

First, they encourage new shoppers to stay close to you after they purchase your products. Second, it guarantees that existing loyal customers feel valued by your action.

Having the best eCommerce loyalty program further ensures customer satisfaction. And additionally, it increases the chances that existing customers will share their satisfied shopping experience with their loved ones.

The more customers feel valued by a business, the more they help the brand by referring it to others. In turn, this cycle continues with word-of-mouth marketing that builds brand reputation.

E-commerce customers love rewards. So, you can reward your loyal consumers, which will make your shoppers delighted and excited to refer new customers to your business.

Of course, the perks you provide in your eCommerce loyalty rewards program are a way to say that you value your customers very much. But your initiative to give extra rewards to your loyal customers makes your store stand out from other eCommerce brands.

By carrying out a loyalty program, you are making an impression on your current and future customer base that you are not just about making profits but additionally engaging with customers and developing a connection.

2. Keep Hold of Existing Customers

It is essential to take all necessary steps to retain existing customers. Reward customers for their loyalty by implementing a loyalty program.

By offering rewards, you can turn existing customers into brand advocates for your promotional campaign and acquire new customers.

By letting existing customers know that you have a loyalty program, you are showing them that you care about their presence and want them to purchase again & again from your store.

Also, you can start giving birthday gifts, free shipping, product updates, explicit time-limit offers, and more. These are great strategies that would get a shopper reconnected with your brand.

3. Increase the Average Order Value

An E-commerce loyalty program increases your average order value. Every time customers place an order, they acquire points or offers which makes them want to buy more.

Whenever there’s a motivation for your customers to acquire points under your loyalty program, you can hope to see your average order value increase.

Here are a few suggestions to look into when having a loyalty program to increase AOV:

• Offer tiered rewards to incentivize higher spending and unlock exclusive benefits.
• Implement double or bonus points on higher-value purchases to encourage larger orders.
• Provide limited-time discounts or special offers for members who reach a certain spending threshold.
• Introduce exclusive product bundles or upsell opportunities available only to loyalty members.

With an effective customer loyalty program, you can acquire and retain customers and build associations with your clients, ultimately urging clients to buy again.

The advantage of having an eCommerce loyalty program is that it assists with building brand advocates and shoppers who continue to return to your site to shop. Repeat customers are bound to purchase more from your store than individuals who are new to your store.

Let us assume that your store sells consumable items people need to repurchase, like razors, toothpaste, or shaving cream. People generally stock these items over a period. You should set up a rewards or loyalty program, as there is more room for customer acquisition and repeat purchases.

With the repeatedly created deals, you create a huge fanbase that will probably order more products at your store. They are less expensive to promote through retargeting, social media, or email advertising. Subsequently, your customers will assist you with expanding the average order value.

4. Drive Lifetime Value and Revenue Growth

The loyalty program is the most effective way to drive customer lifetime value, which is one of the essential reasons to consider a loyalty program for eCommerce businesses.

If you are seeing a regular decrease in your recurring customers and customer advocacy, this implies your customer retention technique needs to be improved.

Growing profit through customer acquisition is still achievable if you nurture customer loyalty correctly. It likewise implies your relationship with your customers could be more engaging, impacted by cost, or there is no energetic relationship to make them loyal to you.

With an eCommerce loyalty rewards program, you can construct a solid bond with your customers as it assists you with sending loyalty prizes with customized offers.

Here are few compelling ways to make your eCommerce rewards program work well:

• Reward your customers for the action they perform on your online store.
• Motivate reviews as a trade-off for loyalty points and value customer assessment of your items.
• Give points for their engagement on your social media channels. (For their likes and social shares).
• Reward clients on their special days, like birthdays.

These are a few ways to use a loyalty program and engage with your clients more significantly. This drives customers to feel you care about them as a person.

Why must eCommerce businesses consider a loyalty program?

The following insights show why you must consider loyalty programs for your eCommerce business.

• 79% of consumers are engaged in at least one retail membership, subscription, or loyalty program.
• In the upcoming years, 52% of U.S. consumers will likely increase their engagement in loyalty programs.
• 74% of consumers believe that feeling understood and valued by brands is crucial for building loyalty.
• A 5% increment in consumer loyalty can increase the average consumer revenue by 25% – 100 percent. (HubSpot).
• Nearly half of the shoppers changed their shopping behavior to reach a higher level in the loyalty programs. (Invesp).

Beyond these statistical data, a loyalty and rewards program provides a few benefits that make it necessary for an eCommerce marketing technique.

1. Win Customers at Low Investment

Do you constantly consider engaging new consumers within your financial budget? And, wondering how? Fortunately, you are not alone; an eCommerce loyalty program is all you need to solve the issue. Keeping a loyal customer base is a method for reducing expenses. The higher the income generated from this loyal customer base, the less the requirement for massive investments.

2. Boost Customer Engagement

By investing resources and efforts into loyalty programs, the expected outcome will be that shoppers stay loyal to your organization. It comes up with additional benefits like improving the customer’s relationship with the brand, increasing trust, and greater engagement via social media.

Besides, consumers can prescribe your eCommerce store to others, a vital exposure for business development.

3. Build Brand Loyalty

However, a loyalty program appears as a technique that consumes a ton of time and cost and builds brand loyalty in real-time.

Assuming that you have a great eCommerce business platform, it is vital to incorporate a loyalty plugin to reward customers with various rewards and build your brand loyalty.

You can likewise depend on the assistance of loyalty programs with a well-built points and rewards plugin and build customer loyalty.

4. Stay Ahead of the Competition

While product choices are expanding, customers are turning more demanding. In addition to cost and quality, they search for brands that know how to reach their target audience and build relationships.

You must consider the loyalty program for your eCommerce businesses because, other than making the brand stand ahead of the competition, it takes the customer closer to your brand. It creates a mutually beneficial situation.

5 Best Examples of ECommerce loyalty programs

Let’s look at some top-notch loyalty programs from online eCommerce stores. These examples show how different companies keep their customers coming back for more.

1. The Good Chocolate

The Good Chocolate rewards its customers through the Good Points program, where members earn points for every purchase, creating a new account, product reviews, referrals, and even on a customer’s birthday.

Why it’s best: The loyalty program is simple, easy to join, and effectively drives customer loyalty by making healthier chocolate more accessible. Its referral program stands out as the best for chocolate lovers to share their word-of-mouth for immediate discounts.

2. BeanBox

Bean Box offers a loyalty program where customers earn credits on every purchase, referrals, and for writing reviews. The earned credits are valid for 3 months.

Why it’s best: Bean Box credits have transparent limitations and expiration which motivates to redeem their credits in a particular time frame. It easily makes customers purchase more and frequently.

3. Olipop

Olipop has a subscription-based eCommerce loyalty program. When a customer subscribes to it, they receive 15% off on every subscription order, free shipping, early access to new launches.

Why it’s best: Customers get immediate value and convenience on every order. It provides a clear, tangible benefit that customers can see with each purchase.

4. Zappos

Zappos comes with a VIP loyalty program which is free to join. It rewards customers with points for every purchase, product reviews, new account creation, and free shipping. It also integrated with amazon prime membership.

Why it’s best: The program’s integration with Amazon Prime adds extra value, while bonus points on select brands keep things exciting. This multi-faceted approach encourages frequent engagement, fosters loyalty, and provides a sense of exclusivity without requiring a membership fee.

5. Toms Rewards

Toms rewards program is free to join. Customers earn points for signing up for emails, following TOMS on social media, creating an account, and leaving reviews.

Accumulated points can be redeemed for discounts. The program includes three tiers: Good, Gooder, and Goodest, each offering increasingly better benefits like higher point multipliers and larger birthday discounts.

Why it’s best: The program’s tiered structure motivates continued participation, while the unique option to donate points for mental health resources aligns perfectly with TOMS’ ethos of giving back, creating a meaningful connection between customer loyalty and social impact.

Best eCommerce Loyalty Program Ideas

• Brand your Loyalty Program
• Focus on your loyal Customers
• Keep Your Loyalty Program Simple
• Use a Trustworthy Loyalty Program Tool
• Market your Loyalty Program
• Personalize your Loyalty Program
• Automate your Email Marketing

1. Brand your Loyalty Program

Loyalty programs that are not branded aren’t exciting for people. Guarantee you use your brand shades and details.

Ensure to provide an entertaining/catchy name to your loyalty program that matches the products you sell. This will ensure a superior and exciting shopping experience for your loyal customers.

2. Focus on your loyal Customers

Having an eCommerce loyalty program is your opportunity to show your customers that you care about them. Your loyalty program shouldn’t be entirely about your products but the ways customers can bond with you.

Please provide them with different ways to gain and reclaim points so they have reasons to return to your store more often.

3. Keep Your Loyalty Program Simple

Your loyalty program shouldn’t be complicated. Indeed, it’s better when it’s easy. The more complex your program becomes, the more the customers feel they need help understanding.

Make acquiring points easy enough that anybody can earn them, and make redeeming points manageable. Instead, give a variety of options to your customers to redeem their points earned.

4. Use a Trustworthy Loyalty Program Tool

While adding applications to your online business store, you’ll need to utilize the best loyalty program plugin to free yourself from trouble. Constantly do your research on finding a suitable plugin for your store.

Each loyalty program tool offers something different from its competitor. From implementation to design, you will need to conclude what type of loyalty program will turn out best for your business.

Always look for customer feedback and various ways to upgrade your present program or make an advantageous loyalty program for your customers.

5. Market your Loyalty Program

People will only join your loyalty program if they realize it exists. Running promotional drives will expand your eCommerce loyalty program awareness and possibly excite new customers to attempt shopping at your store as well.

The main phase to making a loyalty program is your website design and landing pages that urge individuals to join. You’ll have to utilize advertising to make them aware of the program you’ve made.

6. Personalize your Loyalty Program

Personalization is one of the significant aspects of promoting your loyalty program. It can assist you with increasing engagement rates by guaranteeing that all customers are interested in your program and feel like they are part of your brand.

Personalization in messages and landing pages makes it simpler for customers to engage with your products or services personally.

7. Automate your Email Marketing

Create an email campaign to engage and acquire customers with your eCommerce loyalty program and incorporate steps for achieving these benefits.

Feature the prizes they can get using convincing product pictures and wonderful email layouts. Ensure to make your email marketing automated to save time and energy.

Conclusion

ECommerce loyalty programs are practical marketing tools. Customers gain more benefits each time they shop, and you enjoy the benefits like recurring purchases, increased growth, customer retention, and improved brand image.

You must need an adaptable eCommerce platform for a loyalty program to be effective.
To set up an eCommerce Loyalty Program.

• Identify your goals and KPIs
• Determine the actions you need to reward
• Determine the rewards you need to offer
• Determine the kind of loyalty program to run
• Spot an appropriate loyalty program plugin
• Install and configure the loyalty program
• Welcome clients to join the program

After your loyalty and rewards program is set up in your eCommerce store, You screen constantly, break down, and update your loyalty program depending on your customer’s input and the information you gathered.

Frequently Asked Questions