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5 Great Examples of Customer Loyalty Programs Every Brand Can Implement Today

Customer retention has a huge impact on the growing of any successful business. But encouraging customer loyalty is not a piece of cake. Let’s face it, no one wants to lose customers. On the other hand, there are no perfect businesses.

Nowadays, your competitors are only a few clicks away, so customer loyalty is the new marketing. Frederick Reichheld describes customer retention as more than just providing clients with what they expect to get. It’s more about exceeding their expectations so that they become your brand advocates.

Big companies know the high value of loyal clients and the role that a winning loyalty program plays to increase a retention rate. According to the Harvard Business School, the growing of client retention by just 5% can increase the profits up to 95%. Therefore, big corporations spend millions of dollars per year to find out the most effective methods of keeping clients coming back over and over again.

When it comes to increasing customer loyalty for small and medium businesses, one of the most common problems is that companies simply don’t know where to start. Here is a list of 10 successful loyalty programs which can be easily used even for the small businesses. 

  • Simple point system from Boloco.

 A point system is a traditional loyalty program. Regular clients earn points which transform into some kind of rewards (for example, freebies or discounts).

While many businesses opt for this method, it’s still hard to make everything right. First of all, keep the conversation between your brand and the clients simple and intuitive. As practice shows, this form of a loyalty program works better for companies that offer frequent, short-term purchases. One of the greatest example of the successful implementation of points-based loyalty program shows the Boloco, an American restaurant well-known for its burritos.

Clients who own a Boloco Card swipe it at every order, and the system tracks the amount of money spent. Each $50 brings the customer rewards. The brand speaks a language of its audience by measuring points in dollars, and giving free items such as drink and food. Whether it’s an extra small smoothie or a super jumbo burrito, it’s absolutely free once the client earns a required sum of money.

  • Tier system from Virgin Atlantic Flying Club.

 One of the greatest problem facing most businesses trying to implement loyalty programs is finding the balance between desirable and attainable rewards. Using a tiered system is a good way to address this challenge. Give small presents as a standard offering for being a part of the loyalty program. After that, as the regular clients move up the loyalty ladder, encourage them by enhancing the value of the rewards. This system will be effective for hospitality industry, airline or insurance sector.

Virgin Atlantic Flying Club allows their members to gain both miles and points. The clients come under three groups: Club Red, Club Silver and Club Gold. The members move from Red to Silver to Gold getting more and more bonuses, freebies and discounts. The main point of tier system is offering benefits at the early stages. It hooks the clients and motivates them coming back for the ‘gold’ status offers or other cool benefits.

  • Non-monetary program from Patagonia focused on customers’ values.

 Truly understanding your audience means knowing their values. Almost every company can offer discount codes or promotional coupons. But brands that have an opportunity to provide value to the clients in ways other than dollars can build the stronger connection with their audience.

An eco-friendly apparel business Patagonia found out that their customer wanted more than just basic points and discounts. In 2011, together with eBay, Patagonia created Common Threads Initiative to help clients re-sell online their Patagonia clothing. Plus, they offer the Worn Wear program emphasizing that their stuff lasts for years. So there is no need to buy more, when you can just repair your old things. These programs represent Patagonia as a sustainable brand that creates only high-quality products.

  • Fun game from GrubHub

 Everyone loves a good game, right? But what if a loyalty program could be turned into the engaging game not only to encourage repeat clients but also solidify the company’s image. Important to mention that once you decide to hold the contest, you run the risk of having customers feel like wasting their time. To reduce this risk, it’s crucial to assure the audience that you’re not going to cheat on them.

If your clients prefer to buy frequently and enjoy having fun, this type of loyalty program can make purchasing process more entertaining. Besides, almost any business can execute it. For example, GrubHub, an online food ordering website, has successfully run Yummy Rummy sweepstakes since 2011. The rule of the game is simple: once the clients place three orders through this website, they can try their luck and win free stuff. Players should choose 1 of 4 cards and have a chance to receive a free drink, dessert, more credits or other cool items. To make this program work for your brand in the most effective way, do your best to implement new features and stay interesting to users.

  • Coalition programs from American Express.

Strategic partnership with other companies can be super useful for the brand that wants to retain customers and enlarge its footprint. Which company would be the best for cooperation? The answer to this question lies in the understanding of clients’ everyday routine and their buying habits. When you provide your audience with the value that is material to them but goes beyond your basic offers, you are showing your appreciation and caring about their needs. Besides, it helps to reach your partner’s clients and, as a result, grow your own network.

One of the best examples of coalition program is American Express Plenti Program. Since May 2015, they have built a huge partnership base with businesses throughout the country. The members earn points for purchasing at AT&T, Enterprise Rent-A-Car, Macy's, Hulu, Rite Aid, and other stores. Also, they have an opportunity to redeem points by linking their Plenti account with existing store loyalty card. Fortune Magazine emphasizes that Plenti is a powerful way to expand the customer base and save on program costs even for brands like Macy’s that already have effective loyalty programs.

Brands that are afraid of losing their customers can build trust by implementing loyalty programs. The key to success lies in making this program corresponding to the needs and interests of customers. Besides, make it easy-in-use, and your program will always beat one that has greater rewards.