The importance of a loyalty program in e-commerce
Loyalty is seen as one of the most important trends in 2022 within the customer experience, therefore this element deserves some extra attention. A loyalty program is an inexpensive way for a brand to maintain and retain its customer base. Based on a subscription, customers get exclusive access to certain products, services or sales.
Why a loyalty program?
There is clearly a shift visible in the ecommerce landscape. Pre-corona, the focus for most e-commerce companies was on offering the cheapest product without really building a relationship with their customers. Now companies are focusing more and more on retaining existing customers by creating consistency, so that consumers identify more with the brand. This also keeps the customer coming back for certain products and this will extend the customer lifetime value. In addition, several studies have also shown that retaining existing customers is cheaper than attracting many new ones. This does not mean that you should stop focusing on attracting new customers. In addition, retaining existing customers is also the ideal way to build a community, for example through user generated content.
Other advantages of a loyalty program: you will gain more insights into the buying behaviour of your consumers because and you can personalise your marketing. You can use personalised newsletters, which makes customers feel more important. For this the mailing platform Klaviyo can be a useful tool. Furthermore, you also offer your customers security and convenience through the extra services they receive and you only give that extra service to your truly loyal customers. Thanks to all this, the loyalty program is one of the ways you can distinguish yourself from competitors.
The danger with a loyalty program is that it can create a certain fatigue among certain customers, with the consequence that they can unsubscribe. Therefore, it is always important to continue to invest in the acquisition of new customers for further growth.
How to implement a loyalty program in your business?
What follows are examples of services that you can incorporate into your loyalty program. It is important that you determine in advance what your ideal customer needs. Based on this you can create a loyalty program with following services:
- Early bird access to certain offerings or new collection drops
- Points program: after collecting a certain number of points, you can offer a discount.
- Free shipping
- Special offers, only valid for members
- Personalised marketing
(example of the loyalty program of H&M)
The advantage of this type of program is that you can also extend it into your physical stores. For example, people can also save points when purchasing items in the store itself or use their discounts here as well. This is an example of a
Ready for it?
E-commerce companies that already work with Shopify or WooCommerce can easily work out a loyalty program since these sales channels can be easily synchronised with a number of existing loyalty program apps. When selecting the right app, you need to keep a few elements in mind. The app should be user-friendly (like your future loyalty program) and allow you to display offers. In addition, it should also be possible to provide personalised info to your customers. Furthermore, it must be easy for customers to share their experiences on social media. For you personally it is important that there is sufficient customer support when you encounter problems.
Shopify itself lists 6 apps they consider the best:
- Swell rewards
- Marsello v
There are also a number of plug-ins for WooCommerce for implementing a loyalty program:
- Loyalty points and rewards for WooCommerce
- SUMO reward points
You need to see your investments in a loyalty program as a long term investment, which will not produce immediate results. It is important to see this as a process in which loyalty must be earned and the bond you create with your customers only gets stronger and stronger. Ultimately, this will result in loyal customers who are emotionally connected to your brand and keep coming back!
This post is also available in: Dutch