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When well designed, loyalty schemes can be an excellent way to incentivise customer loyalty, and provide you with useful data to drive sales.
My wife has been having physio for over a year and I swear we have had many conversations about her wanting to cancel. To my surprise this week she told me she was off to physio, and I finally discovered the reason she hadn’t cancelled yet.
Every time she attempted to cancel, the physio company told her “oh, but if you cancel you’ll lose your points”. The points lead to free sessions.
To avoid confrontation this was enough for her not to question things last time. This time though she was fuelled by my sarcasm to ask them how many points she has now, and how many more she needs to get a free session.
She has 6 points and needs 18 to get 1 free session (worth about £40 for 10 mins). She’s spent over £1,000 to earn just 6 points. So she’ll need to spend a total of £3,000 to earn the points to get £40 off. Those numbers wouldn’t make me stay.
So my wife cancelled, but it does show the power of a loyalty programme. Customers can collect points knowing that there is a reward of some description coming their way when they reach a certain milestone.
For this week’s Swipe & Deploy, I thought we’d look at some inspiring loyalty programmes run by some of the largest brands.
Tesco was an early adopter of loyalty schemes. With their exclusive pricing which rolled out recently, a Clubcard member gains the benefit of lower-priced options in-store and online, as well as points which convert into vouchers to spend with Tesco and their partners.
If you’re looking for inspiration, Tesco is a good start.
Asda has recently introduced its own loyalty card scheme, which instead allows users to collect points that build a financial balance, which can then be converted into vouchers to spend with Asda (nice to save up all year and use towards your Christmas shop).
Points can be collected in-store and online via their app.
I usually return to my local garage because A) I can pay at the pump using their app and Apple Pay and B) I can collect points, and on every 10th visit, I get a reward. Usually something like 5p off per litre of fuel. Not huge rewards but it’s the habit, ease, and the FOMO effect that makes me feel like I need to complete those visits more than the draw of the actual savings.
McDonald’s coffee has always had innovative loyalty schemes. First with a card and stickers on the side of cups to save up in order to gain a free cup. Now with their app, they have transitioned from physical to digital. You earn points from all orders and they’ve smartly integrated this into their POS in-stores as well as for online orders.
Costa Coffee is a brand that is everywhere in the UK, from High Street stores to petrol stations. Here’s why you should love their loyalty system.
They have enabled their loyalty points scheme to work even in the express stores. These are self-service machines at local shops and in vending machines. These all scan the app and you can redeem the free coffees you earn anywhere that sells Costa.
Legacy rewards and loyalty schemes that were offline relied on physical cards and sometimes even stamps to track progress. There are some brands that still use these methods, but it makes it harder to track loyalty and tie it to customers and data.
Digital loyalty systems using apps and online platforms can easily tie transactions to loyalty, and this incentivises brands to want to provide perks to build that loyalty. You can immediately see how it works. Even offline transactions if using an app can create an order history, so companies can see transactions and the data can be used to promote personalised offers for the products a particular user likes to buy.
Loyalty systems can be complex and if you run a WooCommerce website you might be wondering if there’s a solution. Yes, there is!
Using WooCommerce Point & Rewards, you can reward your customers with points for purchases and other actions, which can then be redeemed for discounts.
View WooCommerce Points and Rewards >
My favourite types of loyalty platforms are the ones where you can see your goal visualised, and you can also you can see tiers and what is required to reach the next tier. These give you micro-goals to encourage you to spend more in order to reach higher tiers and larger rewards.
Vitality does this with its health app which is very inspiring. So does the online printing company Printed.com.
Being able to see what you need to spend to unlock rewards can work extremely well for B2B brands. When Impact used to design materials for print I favoured using Printed.com because they were reliable, the print quality was good, and because I could collect points which could be spent by me, not the company.
I could use the points to buy prints or I could convert them into Amazon vouchers and buy Christmas presents with them. A great incentive for B2B buyers.
Today’s key takeaway is inspiration. Whether you have an online store and you want to collect more data and encourage repeat customers, a loyalty scheme designed in the right way can engage users and incentivise them.
There are many 3rd party tools that can assist in creating reward schemes or transitioning existing schemes to digital with apps and integrations with your website. If you have WooCommerce then their rewards plugin would be a good first point of call.
If you are an offline business seeking inspiration, deciding how to track offline loyalty might be more of a challenge, but you could always revert back to the classic business card and ink stamps like my local coffee shop uses.
Whichever way you choose to go about it, be clear about how points are earned, how to move up through tiers if you have them, what the rewards are and how they can be used. This can help get those sarcastic partners like me to encourage their partners to spend rather than cancel!
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That’s a wrap for Swipe & Deploy #29. Join me next week when I’ll share another insight or piece of inspiration from around the web.
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