Don't Treat All Customers Equal

Your goal should be to understand your customer groups so that you can target your loyalty spend accordingly. Your high value customers might prefer a range of soft benefits, such as better delivery terms or a more personalised service, whereas your high potential customers might prefer a mix of hard and soft benefits. You can choose to reward your higher value customers with better rewards and better metrics.

Ensure Customers Understand the Journey
Keeping the programme simple enough to understand at a glance is key to generating engagement. To help customers understand how they view their progress why not give them their first step on the journey for free just for registering and completing a profile? This could be awarding them a digital stamp, a credit, a point; it doesn’t matter as long as it shows they are moving towards a goal. It gives you good news to impart immediately; the customer feels they have got something for free; they are motivated to see what they can earn and they understand what they need to do.

Redemptions Need to be Frictionless
Reducing any friction in the redemption process will improve engagement and increase customers’ motivation to change behaviours. Allow customers to choose where and how their reward is delivered. Our RewardShop product integrates easily into a loyalty process to create seamless user redemption journeys.

Don’t Over Invest in the Base Level Reward Funding
We would recommend that you keep your base funding rate low for rewards, and then increase the reward for specific campaigns so that customers are only earning when they complete an action or activity. This way you are rewarding specific changes of behaviour. As your customers move up to the top tiers of the programme you could choose to increase the rewards for their total spend or activity with you.

Rewards Must be Achievable
Customers who redeem are 6 times more likely to emotionally invest in your loyalty programme and continue to earn and redeem. When setting your metrics, your high value current and high value potential customers must be able to achieve the rewards (even if it is a stretch, it should be achievable). Also, rather than expiring points or credits at a specific time after they were earned, why not let customers build them up and only expire them after the customer has stopped earning for a set period? The customer has likely already disengaged from the brand at this point so this provides an offering to help win them back.