Loyalty Programs for Online Shopping

This is a top mistake I see during loyalty program launches: NOT showing members anything about their current status during the ecommerce journey. Sure, we have a landing page, a CRM campaign, and a banner promoting the new program. But after signup, our members don’t see a single thing about loyalty (points, tiers, rewards) until AFTER they make a purchase. This approach leaves a ton of member value on the table. Members don’t understand what they’re getting from the program, and don’t take any incremental actions when it matters most. We need to ensure two things are true: (1) Members know what they have earned, will earn, and could earn (2) Members know what future redemption opportunities they are working toward When these things are true, we get the most out of our program – making it more likely that members will do the things we want them to do. These include: →  Stretch basket size / spend  →  Increase conversion →  Accelerate next purchase →  Increase reward redemption →  Decrease member churn We need to nail four things to maximize the value here. They are: 👀 VISIBILITY Loyalty value needs to be displayed on key journey steps including the product detail page, cart, checkout, order confirmation, and banners. 🔁 CONSISTENCY The frontend display logic and the actual backend earn/redeem logic must be managed in the same workflows (and shown / adjusted in real-time). 🛠️ CUSTOMIZATION We must be able to adjust earn & redeem logic as we see fit – e.g. double points on new drops, bonus points for baskets over $100. 🎯 PERSONALIZATION We must be able to change the value proposition both based on customer data, AND based on in-session behavior. So why do brands so often miss here? The main blocker here is technology. If the loyalty system is slow and rigid, then showing this information is going to be too painful. That’s why we’ve made this such a huge part of how we’ve built Talon.One. We are “cart-native” and offer the most flexible loyalty & promotion engine on the market. That means we can show precise value propositions in real-time at every critical step of the member journey. If your loyalty program is nowhere to be found on ecommerce, we are happy to chat and share a few pointers & case studies to bring it to life.  Send me a DM or grab time with our team here:  https://lnkd.in/dRpstHW9

You don’t build loyalty through rewards—you reward customers for already being loyal. Big difference. Loyalty programs are primarily designed for customers who have already demonstrated consistent engagement and loyalty to your brand. The goal isn’t to create loyalty through rewards, but to recognize and strengthen it. By offering rewards, perks, and recognition, you can maximize their lifetime value, whether by increasing purchase frequency, boosting basket size, or encouraging referrals. Tactics like tiered rewards, exclusive access, and personalized incentives help reinforce their commitment and make them feel valued. 𝗦𝗲𝗰𝗼𝗻𝗱𝗮𝗿𝘆 𝗙𝗼𝗰𝘂𝘀:  For customers with the potential to become loyal, the strategy shifts. These customers have shown higher engagement but haven't fully crossed into the loyal customer category. To convert them, 𝗽𝗲𝗿𝘀𝗼𝗻𝗮𝗹𝗶𝘇𝗮𝘁𝗶𝗼𝗻 is key. Tailor rewards based on their behaviors and preferences to create a sense of exclusivity and recognition. It’s also crucial to stay top of mind through strategic touchpoints—whether via targeted email campaigns, loyalty app notifications, or personalized offers that speak directly to their interests. Offering a path to higher-tier rewards as they engage more frequently can further motivate them to commit to your brand long-term. 𝗖𝗮𝘀𝘂𝗮𝗹 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀:  Casual customers require a different approach. They won’t become loyal overnight, and the objective here is gradual nurturing. For this segment, it's all about increasing touchpoints and staying relevant. Broader offers, such as discounts, time-sensitive promotions, or entry-level rewards, help keep them engaged without overwhelming them. The goal is to activate them periodically, ensuring they interact with your brand from time to time. By keeping consistent offers flowing, you maintain visibility, and over time, some of these casual customers may transition into the potential loyal customer segment. ----- Ultimately, loyalty is about retention, not conversion. The focus is on maintaining a strong relationship with those who already support your brand and steadily nurturing others to deepen their commitment over time.

REI members spend 4x more annually than non-members, generating over $171 million in member rewards in 2022 alone. These aren't just loyalty points - they're cash dividends that members earn by shopping everyday at full price. In my two decades as President of KEEN and leading digital transformations at Columbia Sportswear and Deloitte Digital, I've watched countless brands (including my own) struggle with discount addiction. REI and Costco cracked the code on customer loyalty decades ago, and their model is the future of retail. Let me share how these retail giants transformed discount hunters into full-price shoppers, and why every modern brand and retailer needs to pay attention. 𝗟𝗲𝘁’𝘀 𝘀𝘁𝗮𝗿𝘁 𝘄𝗶𝘁𝗵 𝘁𝗵𝗲 𝗳𝗮𝗰𝘁𝘀… Costco Wholesale (source: Costco 2023 Annual Report): - 128 million paid members worldwide - 90% membership renewal rate globally - $4.6B in membership fees in 2023 REI (source: REI 2022 Annual Report): - 23 million co-op members - 75% of total sales come from co-op members - Members spend 4x more annually than non-members - Generated $171.2M in member rewards in 2022 While most brands and retailers were chasing points programs and discount codes, two retail giants quietly perfected the art of customer loyalty decades ago. REI and Costco's dividend-based membership programs have consistently driven full-price purchases while building incredible customer loyalty. Their secret? Understanding a fundamental truth about human behavior: customers will gladly pay full price today for a meaningful reward tomorrow. Here's the brilliance behind their model: These companies fundamentally changed how customers think about value. Instead of training shoppers to wait for discounts, they created a system where every purchase builds toward an end-of-year cash reward. This simple shift transformed their customers from discount hunters into full-price shoppers. At Angle, we're bringing this proven model directly to Shopify brands. Premium brands and retailers can now offer the same powerful incentive structure: - Cash back rewards on full-price purchases - Instant visibility into accumulated cash-back rewards - Seamless redemption across channels - Paid or free membership programs - Digital wallet passes instead of physical membership cards The future of brand building isn't endless discounting - it's giving customers as many compelling reasons to pay full price. REI and Costco figured this out decades ago. Now, Angle is making it possible for every brand and retailer to apply these same principles. Let's be brutally honest: Slapping a points program onto your existing business model isn't loyalty - it's a band-aid. True loyalty isn't bought with discounts or earned through generic platforms. It's built by fundamentally rethinking how value flows between your brand and your customer.

Loyalty programs are a waste of time—unless you’re a retailer who knows how to play the long game. I’ve spent the last five years deep in the trenches of cannabis retail marketing, and I’ve seen my share of lackluster customer loyalty programs. They need to go beyond 1 point for $1 and offer more than weekly email/text blasts of sales. Retailers who understand the long game of customer loyalty do these things: 𝗣𝗲𝗿𝘀𝗼𝗻𝗮𝗹𝗶𝘇𝗲 𝗼𝗳𝗳𝗲𝗿𝘀 𝗮𝗻𝗱 𝗿𝗲𝘄𝗮𝗿𝗱𝘀. ↳ Customers aren't just looking for deals; they want to be SEEN and feel special. 𝗨𝗻𝗱𝗲𝗿𝘀𝘁𝗮𝗻𝗱 𝗻𝗼𝘁 𝗮𝗹𝗹 𝗰𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 𝗮𝗿𝗲 𝗰𝗿𝗲𝗮𝘁𝗲𝗱 𝗲𝗾𝘂𝗮𝗹. ↳ Rely on data to tailor and refine your rewards and program. 𝗨𝘀𝗲 𝗮 𝘁𝗶𝗲𝗿𝗲𝗱 𝘀𝘆𝘀𝘁𝗲𝗺 𝘁𝗵𝗮𝘁 𝗼𝗳𝗳𝗲𝗿𝘀 𝗶𝗻𝗰𝗿𝗲𝗮𝘀𝗶𝗻𝗴𝗹𝘆 𝗯𝗲𝘁𝘁𝗲𝗿 𝗿𝗲𝘄𝗮𝗿𝗱𝘀 𝗮𝘀 𝗰𝘂𝘀𝘁𝗼𝗺𝗲𝗿𝘀 𝘀𝗽𝗲𝗻𝗱 𝗺𝗼𝗿𝗲. ↳ This not only incentivizes higher spending but also fosters a sense of exclusivity. 𝗘𝗻𝗴𝗮𝗴𝗲 𝗯𝗲𝘆𝗼𝗻𝗱 𝘁𝗿𝗮𝗻𝘀𝗮𝗰𝘁𝗶𝗼𝗻𝘀. ↳ Create community events, educational workshops, and exclusive previews for loyalty members. 𝗨𝗻𝗱𝗲𝗿𝘀𝘁𝗮𝗻𝗱 𝘆𝗼𝘂𝗿 𝗰𝘂𝘀𝘁𝗼𝗺𝗲𝗿'𝘀 𝗷𝗼𝘂𝗿𝗻𝗲𝘆. ↳ Connect with customers at appropriate touch points. All these things create an emotional connection that goes beyond mere transactions. Remember, a loyalty program isn’t a quick fix. It’s a longterm investment that requires constant tweaking and genuine engagement. But when done right, it can be a powerful tool to boost customer retention and increase sales. Are you ready to play the long game?

Creating a Winning Loyalty Program: Key Questions & Strategies I've always been passionate about creating loyalty programs for brands. It's a valuable way to connect with & learn from your customers while delivering concrete business results, especially as customer acquisition costs rise. Before implementing a program, my team and I spend significant time contemplating these essential questions: 1. Customer Value Proposition: Why would our customers want to join this program? How can it enhance our engagement and connection with them? 2. Business Impact: How will we measure this program's effect on customer retention, frequency, incrementality, and advocacy? What's the ROI? and what's a reasonable timeline for achieving this? 3. Management & Profitability: Who will oversee the program within the team? And ensure that we factor in all the costs, identify efficiencies, and drive profitability. 4. Best-Practices: What loyalty programs do we admire, and why? We examine our industry & other sectors. 5. Pilot Market: What market will we pilot in? Noting that programs don't work universally across the globe. It's essential to customize tiers, rewards, and consider currency, points liability, and robust fraud management as we scale. 6. Tech Stack Integration: Which loyalty program tech stack aligns with our current & future business needs & seamlessly integrates with our DTC ecosystem? 7. Data Collection: How does this program fit into our data collection initiatives? What consumer insights do we hope to gain clarity on? Next, it's important to think about how our customers earn rewards: 1. Spend: Customers can earn rewards by spending a total accumulated amount over time (drives LTV & can increase AOV) or by spending a certain amount today to receive specific rewards (to boost AOV). 2. Share: Earning rewards can also involve actions like writing a review (drives UGC & SEO), sharing personal data on their birthday (drives personalization), or referring a friend (helps with CAC). Finally, what are the customer benefits of the program: 1. Saving: Customers benefit from savings, which could be in the form of a specific dollar amount off or a percentage discount, along with GWPs etc. 2. Services: Benefits can also include free shipping, early access to new products or sales, free alterations, and more. 3. Experiences: Customers can get invited to in-person events, become part of a like-minded community, gain access to a personal stylist, or provide feedback on new products. For me, two loyalty program pillars are: transparency & commitment. When changes to the program are made, we communicate with care and provide ample notice. It's essential for our customers to feel genuinely valued by our brand. Trust can be earned but lost in a nano-second if we neglect the importance of maintaining a positive relationship with our customers. Thus, we focus on creating joy, and this helps ensure that our brand shines. #customerloyalty #valuecreation #brandlove

Fashion brands give away 15% of their profit to acquisition when they ignore retention. I learned this running eCommerce for a billion-dollar retailer. The real problem isn't your customer acquisition cost. It's your loyalty program (or lack of one). Most brands treat loyalty like an afterthought; basic points for purchases. Smart brands build retention systems that create genuine value. We helped a fashion client increase repeat purchase rate by 47% with: -Tiered rewards based on engagement, not just spending -Early access to new collections for VIP members -Personalized styling recommendations for loyal customers -Community features that build brand connection The result? Customer lifetime value increased by $127 per customer. 23% higher retention rate. 31% boost in average order value. Your loyalty program isn't just customer service. It's your most profitable growth channel.

One of the biggest takeaways I spotted from Intuit Mailchimp’s analysis of the 2024 holiday shopping season is that the new year is ripe with new opportunities to drive loyalty. Here’s why → 64% of orders from Mailchimp customers with connected stores came from new customers during Cyber Weekend 2024. That's a huge opportunity to grow your loyal customer base! And research we produced with Canvas8 tells us that the best kept secret to driving loyalty is actually grounded in science. Our Loyalty Wheel reveals 4 key drivers of loyalty: 1. Reward: Our brains love rewards. Create a sense of reciprocity by offering exclusive deals, personalized discounts, or early access to new products. 2. Memory: Make it easy for customers to remember (and repeat!) positive experiences with your brand. Design a frictionless customer journey, offer subscriptions for frequently purchased items, and send well-timed reminders. 3. Emotion: Foster an emotional connection that goes beyond transactional exchanges. Align your brand with causes your customers care about, share authentic stories, and build a sense of community. 4. Social Interaction: Encourage customers to share their love for your brand with friends and family. Create opportunities for user-generated content, run refer-a-friend programs, or host exclusive events. And here's how to put it all into action: 🎉 Surprise and delight: Gift your customers with unexpected rewards. And just not generic discounts. Offer exclusive experiences or partner with like-minded brands to create unique offers. 🛝 Streamline every touchpoint: Remove friction in the customer journey with automation. From browsing to purchasing to post-purchase support, make it easy and enjoyable to do business with your brand. 🎯 Prioritize personalization: Craft your messaging and build authentic connections. Use data and AI analysis to understand your customers' values and preferences and use those insights to create content that resonates. 🤗 Give VIP treatment: Make your customers feel like VIPs. Give them early access to new products, invite them to exclusive events, or feature them on your social media channels. Download Mailchimp and Canvas8’s The Science of Loyalty and The Strategic Loyalty Playbook for a deep dive into the science, complete with actionable strategies and inspiring examples: https://bit.ly/49FJayO Make 2025 the year of the loyal customer. You got this.

I analyzed 100+ loyalty programs in the last 30 days. Most brands still run loyalty like it’s 2009: Earn points, get a discount, repeat. The top 10%? They’re using loyalty to change behavior- not just reward it. If I were Head of Loyalty at a $10B+ brand today, here are the brands I would copy to build a program that drives LTV, repeat purchases, and real retention: PAYMENT-LED: 1/ STARBUCKS: 34M members, $1.78B stored value, 3x higher spend from rewards members. My kids love their hot chocolate and cake pops - so Starbucks has a special place in my heart 2/ TARGET: Circle members spend 5x more, with $4B processed through their payment rails in Q1 alone. Huge creds to Efrain Irizarry 3/ 7-ELEVEN: 55M+ members, 38% of transactions through their app 4/ DUNKIN': Wallet reloads driving 2.5x visits, 20% higher AOV 5/ CHASE SAPPHIRE: Premium card driving aspirational loyalty with travel and dining rewards aligned with luxury lifestyle; strong partner ecosystem SUBSCRIPTION-BASED: 6/ AMAZON PRIME: Loyalty disguised as convenience 7/ RH MEMBERSHIP: Luxury subscription boosting margins 8/ COSTCO: Unbeatable renewal rates and loyalty lock-in 9/ PANERA UNLIMITED SIP CLUB: Daily engagement via low-cost subscription AIRLINE & TRAVEL: 10/ UNITED: Loyalty program generated $1.8B in EBITDA (26% of total) 11/ DELTA: Loyalty now constitutes 57% of total revenue 12/ AMERICAN: 61% of flight revenue from AAdvantage members (used as $10B loan collateral) 13/ JETBLUE: Loyalty program worth $5.5B, more than half their financeable assets RETAIL AND FASHION: 14/ ADIDAS ADICLUB: 240M+ members, 2x higher LTV, 50% more frequent purchases 15/ UNDER ARMOUR: Members 2x more likely to make repeat purchases within 90 days 16/ KITH: Early access, raffles, skip-the-line, exclusive events 17/ SEPHORA: Tiered rewards building emotional connection beyond discounts QSR & FOOD SERVICE: 18/ CHICK-FIL-A: Loyalty tied to brand values, not just points 19/ SWEETGREEN: Personalized spend challenges over traditional points ~~ While many brands still hand out points like it’s 2009, top performers are building payment-loyalty loops that shape behavior- not just reward it. Less old-school points. More embedded wallets, subscriptions, and emotional incentives to drive customer engagement and brand loyalty. The best brands don’t see loyalty as a marketing tactic, they treat it like a strategic financial asset. PS: DM me “loyalty” to get the full Top 30 breakdown + our Loyalty Program Launch Checklist we use with leading fintech, retail, and QSR brands.

The biggest myth in loyalty programs is that discount coupons are the only way to drive repeat purchases. Here's what actually works: A flexible commerce catalog can help your brand build loyalty programs that don't erode margin by default. Think about the typical scenario: You buy something, then receive a 20% off coupon to come back. That 20% comes directly from your margin. But there's a better way. With a flexible commerce catalog like Elastic Path offers, you can: • Build a catalog specifically for loyalty/VIP customers • Do exclusive drops where the value is first access, not discounts • Charge appropriate prices without discounting • Create value through exclusivity and limited inventory Research shows Gen Z and millennial customers respond more positively to this type of exclusivity in loyalty programs than to traditional offers like free shipping. The real value isn't in the discount - it's in the exclusive access. #ecommerce #composablecommerce #loyalty #digitalcommerce

Premium (paid)-based loyalty programs are increasingly popular. Think AMAZON PRIME, Walmart+, or RH Grey. With free points-based loyalty programs, consumers might sign up for a dozen programs or more, but for premium loyalty programs, customers are choosier, often paying for just one program in a category. Here are 5 benefits of a premium loyalty program: 1/ Increased Value Over Time → By getting members to commit early, they indicate preference early in the relationship. Since they have already invested, they are more likely to spend more over time 2/ Preference → Customers often start with premium loyalty programs when facing an ongoing problem, making you their first choice before exploring other options. 3/ Community → Direct communication builds a community. Members are more willing to engage, support each other, and bring in others. 4/ Average Order Size (AOS) → AOS is higher for premium members than nonmembers. In addition to more frequent purchases and the cost of the program itself, you also enjoy bigger spending at the point of checkout 5/ Returning Revenue is More Profitable → It's cheaper to keep a customer than to attract a new one. +++++++++++ 👋 I'm Robbie, I'm a consultant, author, and speaker covering all things subscription businesses. +++++++++++ 🛎 Tap the bell under the banner on my profile to catch the next post. ++++++++++++