An effective customer retention strategy helps a business keep the customers it has worked hard to get. Although there are several customer retention methods, a loyalty program is among the best and reliable strategies.

A loyalty program rewards your loyal customers and motivates them to keep buying from your Shopify store. If used correctly, it can boost customer value and promote repeat and time between purchases.

However, while loyalty programs do work, not all of them are effective. The best way to build a rewarding loyalty program is to know the features that matter to your customers.

Today, we look at the must-have components that successful loyalty programs should have. Let's get started.

Components of an Effective Loyalty Program

For a business to launch a successful loyalty program, these 7 elements are a must-have:

#1. Brand Personality

A loyalty program reflects your brand, and companies can use it to strengthen the relationship they have with their customers. Therefore, when building a loyalty program, ensure that it speaks your brand personality. If your brand personality is ruggedness, sincerity, or sophistication, make sure to bring out these values in your loyalty program.

Also, note that customers may ignore a loyalty program if they feel a separate experience. Thus, make sure your program connects with your brand experience and store.

An easy way of doing that is by naming the loyalty program and pointing out something that relates to your brand.

#2. Motivate Customers

Since a loyalty program fosters the relationship a business has with its clients, it should appear that it offers a reward. Remember that your program must show benefits. Otherwise, the customers might not join it.

For instance, if selling clothes, you could give away a pair of socks to customers that sign up for your loyalty program. Such rewards entice the customer to join your loyalty program instantly as they offer instant gratification.

It's also essential that you concentrate more on points than money. Note that some people may be hesitant to join your program if you ask them to spend a certain amount of money. They may question whether they are benefiting from the program or giving businesses more revenue.

However, by awarding points, the program looks more like a game. You can reward extra points to your loyal customers during slow days.

#3. Onsite Reminders

While your program needs to offer a reward, it won't be useful if your customers don't know about it. Don't assume that they will discover the program on their own. Because if they don't, it slows your potential growth.

Onsite reminders help inform customers about the reward program you are running. You can do that through an explainer page or a customer launcher that motivates them to sign up. Doing this increases your program's visibility, making it more accessible and successful.

#4. Exclusivity

Many of your competitors are also running a loyalty program. Therefore, you must give customers reasons why they should consider yours.

Think about it. How many times have you been asked whether you are a rewards member or have a membership card? Chances are that you rushed to the cashier to tell them that you don't want to have another card or keychain accessory.

Most of us do this because we haven't been informed about the benefits of joining such a program. Therefore, if you want your loyalty program to be successful, ensure that it offers exclusivity.

Make sure your customers know the deals, offers, and access they will get from engaging in your program. Communicating the benefits can make a big difference in the adoption of your program.

#5. Valuable and Tailored Rewards

Now, while your program should offer benefits, ensure that the rewards are what the customers want. People don't just earn points for the sake of it. They want these points so that they can redeem them later.

Therefore, you could start by allowing your customers to redeem their points for specific things or everything if it's possible in your store. But ensure that the items you're offering offer high perceived value that appeals to your target customer.

For instance, if your store sells skincare products, make sure that your rewards help your customers care for their skin. Remember that what matters most is the rewards customers get from a program and not the price tag attached.

#6. Multiple Engagement Points

Your program needs to support multiple opportunities for engagement. However, you need to put so much thought into this to choose the best engagement points.

Your program can support a transaction or point of sale model. Such a program rewards customers at the point of purchase. It encourages them to spend more to receive better offers or discounts. This method is suitable for those with various brands and who want to increase customer value.

You can also have a catalog-driven program, where you have a well-defined catalog and encourage customers to make more purchases of specific products to expand their collection.

There's also the all-encompassing loyalty program that includes point of sale, exclusive offers, and rewards. Consider your customer base when choosing a program. Then ensure that customers can engage with it in multiple ways to create continued interest that influences their buying behavior.

#7. Great Mobile Experience

Many people are shifting towards mobile shopping. For this reason, your rewards program should be optimized for phones to maximize your revenue. For instance, Starbucks makes more than 6 million sales from its mobile app alone per month.

Well, you don't necessarily have to create a mobile app. But you need to offer a better experience than the desktop one. Doing that ensures that you don't lock out your mobile customer base.

Final Thoughts

These fundamental components will help build an effective loyalty program that will attract more customers to join. But keep in mind that your rewards program should be exclusively about the customers and not the business. Once you've started running your loyalty program, you need to measure the success to see whether it's working and where to improve.

If you need help building a successful loyalty program for your Shopify store, Glow Loyalty can help. Our app can help you run a successful customer loyalty program and measure performance quickly using the available charts and graphs. Contact us if you have any questions.