Boost Retention, Referral & Spending with a Loyalty Program

7 min read

Loyalty Program Website On Laptop Screen

Regardless of size, every eCommerce store should set up a loyalty program to remain competitive and profitable. Today’s loyalty programs must focus on a variety of platforms, devices, channels and ensure that these channels integrate seamlessly.

The loyalty program has been a marketing tool around since the late 1700s. Some of the most successful examples in the last century were S&H Green Stamps issued by grocery stores, collecting box tops by Betty Crocker and other food producers. American Airlines developed the first significant non-food loyalty program with their frequent flyer program.

The key purpose of a loyalty program is to nurture your shoppers into loyal customers. How? By providing them with a satisfying emotional experience at every touchpoint of their loyalty journey. Loyalty program members who actively redeem points spend 2.5 times more than non-members. Shoppers who join a loyalty program are 68% more likely to buy again than those who don’t sign up.

To build a thriving retail business in any vertical, you need repeat customers. This blog will explore why you need to have a customer loyalty program and the best ways to get started.

Why eCommerce Retailers Should Have a Loyalty Program

Loyalty Programs Performance Statistics

By offering an attractive loyalty program, you can generate more sales and increase Customer Lifetime Value (CLTV). Promoting products to your existing customers is always more cost-effective than attracting new ones. Improving your customer retention rate by 5% can increase profits by as much as 95%.

New customer acquisition is expensive. Online ad agency, WordStream, reports that small businesses pay about $1,000 a month while medium enterprises spend an average of $9,000 per month on Google ads to attract new customers.

6 Reasons to Setup Your Customer Loyalty Program

Customer retention costs 3 to 10 times less than finding new customers. A loyalty program is essential to retaining and reactivating existing customers. Here are six reasons to set one up for your store:

  1. Build Brand Affinity - Rewards, gifts, and valuable incentives help to create a gratifying customer experience, which makes your brand memorable and encourages shoppers to return. An IRI Consumer Connect Survey shows that 74% of customers shop at a store with a robust loyalty program.

  2. Improved Shopper Engagement and Experience – A loyalty program is an excellent way of increasing customer engagement. Shoppers feel appreciated when rewarded for their purchases, acknowledged on their birthday, holidays or anniversaries. Reminding customers of any promotions, sales, or favorite products significantly improve customer satisfaction and fosters a positive customer experience.

  3. Increased Customer Retention – Shopify’s statistics reveal that 84% of customers admit that they’re more likely to stick with a company that offers a loyalty program. Additionally, 66% of customers say the ability to earn rewards changes their spending behavior.

  4. Increased Customer Lifetime Value – A loyalty program increases CLV. Digital marketer Neil Patel states, “customers who actively engage in loyalty programs purchase 90% more frequently, spend 60% more in each transaction, and are five times more likely to buy again.”

  5. Sales and Revenue Growth – Research suggests that 75% of customers have no problem switching brands for a better loyalty program. 81% of millennials polled said their membership increases the amount they spend with the brand.

  6. Creates New Brand Advocates – An excited and happy customer loves to spread the word about their positive shopping experience, whether in-store, online, or mobile. They can influence their network and drive new customers to try the brand or product.

Take the time to plan it properly to make it easy and worthwhile for your customers to participate.

An Efficient Loyalty Program

Loyalty Program Tiers Outline

A lot of companies make the mistake of not having a long-term vision for deploying their loyalty program. Instead, they develop short-term promotions, prices, or benefits targeting the entire customer base. Doing it this way means some customers won’t take advantage of the program, making it a waste of your marketing budget and resources.

Older loyalty programs only rewarded customers for purchases. Current trends include rewarding a variety of customer actions to deliver a personalized and varied experience. Successful retailers encourage shoppers to promote their products on social media. They reward positive product or service reviews, taking surveys, or referring a friend. Savvy marketers give rewards to customers who post videos wearing or using their products.

Loyalty programs give you access to valuable customer insights. Customer data should reside in a centralized system where it can deliver the latest trends in consumer behavior.

One company, in particular, LoyaltyLion, is a fully customized engagement platform.

LoyaltyLion’s Data-Driven Customer Engagement Platform


LoyaltyLion is a data-driven loyalty and engagement platform. Their unique combination of best-in-class technology and dedicated loyalty expertise helps thousands of marketers use loyalty programs to drive more revenue from highly engaged, highly valuable customers.

The company was established in 2012 by Charlie Casey and Dave Clark. They serve more than 43 million retail customers in over 55 countries. They started LoyaltyLion to address two common eCommerce problems. One is the rapidly increasing customer acquisition costs, and the other is the overcrowded marketplace.

LoyaltyLion targets quick-growth retailers on Shopify, Magento, Big Commerce, Lightspeed, and others. Retailers of any size can set up LoyaltyLion in about 4 minutes. The platform automates 80% of the tasks. Then the retailer handles the other 20% to customize the program for their business and customers. Most stores using LoyaltyLion typically generate an average of $15 for every $1 they spend on the platform. Features

Along with an interactive app, here is a quick snapshot of LoyaltyLion’s key features.

  • Loyalty Tiers – Retailers can create four reward tiers offering exclusive rewards to qualified customers at each level. Conditional tiers motivate customers to subscribe and keep buying

  • Completely Customizable – You can match your store’s branding by changing the text, colors, fonts, and images

  • Setup Points for Any Occasion – Set up specific triggers to reward particular customer actions, purchase amounts, or anniversaries to make customers feel special

  • Reward Referrals – The most cost-effective customer acquisition is a referral. Reward customers who make referrals via Facebook, Twitter, email, or WhatsApp

  • Fully Personalized Emails – Email customers automatically when they accrue enough points for a reward to increase repeat purchases

  • Advanced Analytics - Gain a 360° view of your customers. Use detailed analytics to reward the most loyal customers, encourage low-volume customers, and win back old ones

  • Easy to Manage – Handle everything from the dashboard, including adding and approving points, blocking customers, and managing all aspects of the program

  • Success Manager – Ongoing coaching and regular advice from the specialists ensures the program’s success

  • On-Boarding Assistance – LoyaltyLion has experts to help set up the app on your store on any major platform

LoyaltyLion works with any size store, including enterprise stores shipping over 800 orders per month.

Connect and Accelerate Your Marketing Efforts

It’s easy to set up a customer loyalty program with this company, and their track record shows that the service produces a substantial ROI. To see relevant eCommerce examples, read their case studies here.

Reach out to the eCommerce experts at Eventige if you need help with a loyalty program or other assistance to grow your eCommerce store.

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