Customer Reward Programs in E-Commerce: 15 Ideas and Tricks

Are you planning or reconsidering a customer reward program? Don’t miss these 15 tips to make it work!

Though reward programs are designed to stimulate buying, quite often customers pay no attention to loyalty perks. There can be two main reasons for that:

  • first, customers prefer to avoid long and complicated rules;
  • second, shoppers don’t want to bother doing extra activities, even if it brings benefits.

The latter is more about upgrading a web store technically. Simply put, it requires selecting and running a good module for your e-commerce platform. For example, Magento 2 webs store owners can try this Reward Points extension.

The former is more intricate and takes mastering the art of creating a Reward Program. We asked our Magento 2 clients to share their advice and these are the 15 golden tips we got as a result.

#1. Start simple with points

If you have a small shop or are just starting out with loyalty programs, try a straightforward scheme first. According to COLLOQUY Loyalty Census, the main reason to participate in a loyalty program is the ease of use (53% of respondents). So at the first step, you can give Magento 2 reward points for a particular amount of money spent in your web store. For example, you can gift 10 bonus points for every $10 in the cart and give a 5% discount for every 50 reward points. The more money customers spend on purchases, the more bonus points they get.

#2. Grow more sophisticated with tiers

As your customer base keeps expanding, you can introduce loyalty levels. After customers reach a certain number of reward points, they get a new loyalty level and can access more benefits and higher discounts. Many people increase spending just because they understand that the next level is achievable and advantageous to them.

#3. Make progress seem easier

Some Magento 2 web store owners multiply the reward points of customers that have particular tier statuses. This technique makes the next tier look more achievable and motivates customers to go on purchasing.

#4. Reward to learn customers better

To reach customers’ hearts, marketing messages should relate to shoppers’ personality. One of our partners shared a secret that they ask for additional customer info in exchange for reward points in their Magento 2 stores. This helps them better understand the motivation of customers. Later, you can use such data not only for your sales needs but also to surprise customers with birthday discounts.

#5. Reward the way they want it

Many customers abandon loyalty programs because they don’t find the rewards useful for them. To reverse the case, you can use customer info and deliver targeted rewards that correspond with your shoppers’ personalities. This way, you will show that you really care about customers and not only about their purchases.

#6. Reward as much as you can

You can make customers your real advocates just by diversifying the loyalty program. Our client wrote us that this strategy helped them considerably improve the efficiency of rewards. The thing is they were giving bonus points for social activity, like subscription and following on social media, posting and sharing tweets and reviews. The more options they were giving, the more interested customers were getting in earning points. Besides, by rewarding social activity, you hit two targets simultaneously: advertising your brand and marketing the reward program itself.

#7. Introduce point days

Special point days is one more technique to stimulate buying and let customers reach a higher tier level. Choose some calendar days (for example, in a low season) when you give points for every purchase.

The number of such days can depend on the loyalty level, for example, one day for Tier 1, two days for Tier 2, etc. This measure stimulates customers to follow your updates and increase purchases at the time of the year when your sales are normally lower than average.

#8. Trigger referral activity

Many Magento 2 retailers give reward points for inviting friends to the web store. To make referring easy, you can provide a template email that customers can quickly configure and send. Don’t forget about the customers’ friends as well and give them a welcome discount or some reward points.

#9. Drag moral values

You can appeal to moral values by motivating customers to do good just by buying. For sure, these values should comply with your business culture. For example, if you sell eco cosmetics, you can give reward points for more expensive yet cruelty-free brands. Or as a bookseller, you can reward for supporting local amateur writers or artists. Including human values in the reward program helps you reach customers at a more personal level. Apart from drawing desires, you start matching values.

#10. Come into their lives

You can go one step further into the customers’ personal world and reward them for changing their own lives for the better. For example, a web store selling sportswear of facilities can reward participation in marathons. A web store specialized in eco-food can introduce a reward program for adopting healthy habits. This way the brand becomes more than a seller in customers’ minds; it becomes the leader of the community.

#11. Use partnerships

Some merchants use their partnerships with other companies to give customers more reward options. As an example of such a program, a cafe can give discounts for buying items in the partner coffee shop every time a customer orders a particular hot drink.

#12. Let them win

Gamification makes earning reward points and incentive levels more interesting and emotional. Customers risk nothing but can win a higher loyalty level or particular items when they purchase in your web store. You in turn get more customers that are aware of your web store and interested in buying.

#13. Let them pay for incentives

You can also offer a VIP set of incentives on a paid basis. Include the benefits that customers will find useful and worthy, for example, higher discounts, free delivery, access to VIP products, etc. The perks can be even exclusive materials from behind the scenes of the brand, invitations to parties and events, or the ability to vote for the concepts of future products. Try everything that can make customers interested!

#14. Make it easy to redeem points

Even though customers like bonuses, they don’t want to bother how to use them. To keep it simple, our Magento 2 partners let customers claim their reward points at the checkout page.

#15. Combine to give and get more

A winning loyalty program should both stimulate customers to collect points and make it easy to redeem bonuses. The trick is to find your ideal combination of reward rules. Is it tiers and gamification? Is it tiers and partnership? Look at your customers and try to understand their expectations from a loyalty program. Are they ready to pay extra for a luxurious approach? Or do they want their favorite brand to be a part of their social lives? The key is to create a hybrid program and still keep it simple to understand.

Takeaway: Be ready to evolve

There can be no ideal reward program for all web stores and all times. Try some basics first and look at the response of your customers. After you analyzed the drawbacks of the first try and hopefully gathered valuable insights from customers, you can come up with a more sophisticated loyalty program.

And one more bonus tip for those drawing a sketch of a Magento 2 loyalty program: check the Reward Points extensions on the Magento Marketplace. They will give you an idea of the most popular and most efficient features in this regard.

All opinions expressed on USDR are those of the author and not necessarily those of US Daily Review.