Innovative Shopify Loyalty Program Ideas to Increase Retention

Customer acquisition is no easy feat. It's a costly endeavor, as attracting a new customer can cost 5x to 25x more than retaining an existing one. Undoubtedly, repeat customers are easier to sell to than new customers. They are also your top 5% of customers, generating 35% or more in revenue.

While various strategies exist to boost retention and enhance customer loyalty, one of the most effective tools is a Shopify loyalty program.

What is a loyalty program?

A loyalty program is a well-structured, customer retention marketing strategy that encourages customers to shop from your store on a long-term basis. Through rewards, discounts, and other incentives, loyalty programs enable you to thank customers for their loyalty and trust in your business.

When you implement a Shopify loyalty program, your focus is to amplify repeat purchases by retaining your customers. You can do this by offering tangible rewards for their continuous engagement. This way, they are more likely to make future purchases, leading to more sales and improved customer lifetime value.

Moreover, loyalty programs make customers feel appreciated. This can in turn lead to increased satisfaction and a stronger emotional connection to the brand.

How do ecommerce loyalty programs work?

Ecommerce loyalty programs function through a few basic strategies that drive customer interaction and retention. These include:

Points accumulation: In most loyalty programs, customers earn points for each purchase they make. The number of points earned can be proportional to the amount spent, encouraging higher spending.
Points can also be awarded for specific actions like writing reviews, referring friends, or engaging on social media. Based on the rewards against the points collected, customers can be driven to make more purchases.
Reward redemption: The accumulated points can be redeemed for discounts on future purchases, free products, or exclusive offers. The redemption process is fairly straightforward, making it easy for customers to see the value of their participation.
Membership tiers: You can use a tiered-based loyalty program to incentivize higher levels of engagement. Customers start at a base level and can advance to higher tiers by collecting more points or making more purchases. Each tier offers increasingly valuable rewards. The bigger the rewards are, the more the customers will be driven to achieve them.

Loyalty programs work as simple as this. Having a loyalty program in your store allows you to create more personalized offerings for your customers. Through customer loyalty data you can gain valuable insights into what drives your customers to remain loyal to your brand.

Moreover, personalization means enhanced engagement. Customers who are active in a loyalty program are more likely to interact with the brand regularly. In short, they are your brand ambassadors! To further enhance your loyalty program, consider exploring Shopify Collabs. Collaborating with other brands through Shopify Collabs can expand your reach and provide additional value to your customers.

You can take this a step ahead with a streamlined checkout process. Implementing a Shopify one-page checkout reduces friction during the purchase process, making it easier and faster for customers to complete their transactions and earn loyalty rewards.

Before diving into implementing such programs, it's useful to know what other merchants think about the platform. Checking out a Shopify review can provide insights into how effective these tools are in real-world applications.

4 Loyalty program Shopify ideas to try out

The goal to building a well optimized loyalty program is to listen to your customers and seek what they are asking for in a program. It's also to test and try new ideas to make your rewards and loyalty program successful.

1. Eco-friendly rewards program

An eco-friendly rewards program is sometimes known as a green loyalty program. Being an environmentally-conscious brand can set you apart and is an excellent competitive differentiator.

In this program, customers are encouraged to purchase your green products or services in return for a reward. The focus of such programs is to aid customers in making environmentally conscious choices. This approach not only promotes sustainability but also aligns with the values of conscious consumerism.

Example ideas for green loyalty program:

Eco-friendly shipping: Customers can earn points for choosing eco-friendly shipping options, such as carbon-neutral delivery.
Sustainable purchases: Reward customers for purchasing products from your green or eco-friendly collection.
Recycling program: Offer points for recycling products through a buy-back or recycling program. Customers can return used products and earn rewards, supporting a circular economy.
Reusable packaging: Offer exclusive rewards for customers who commit to sustainability, such as a discount for using reusable packaging.

Eco-friendly brand Dropps launched their loyalty program in 2017, and has grown into an integral part of the brand. With their rewards program customers earn points for referrals or purchases and have the opportunity to redeem them for discounts off their next purchase. Their products come in reusable packaging, and offers eco-friendly shipping.

2. Gamified loyalty program

Gamification transforms your regular loyalty program into a fun, interactive, and engaging experience. It includes the application of game-design elements to non-game contexts. By making the process of earning points and rewards a game-like experience, you can motivate customers to participate more actively, increasing their engagement and loyalty to your brand.

Moreover, gamified loyalty programs tap into the human desire for achievement and recognition. This makes customers more likely to return and interact with your brand frequently.

Challenges and quests: Create specific tasks that customers can complete to earn points. For example, Death Wish Coffee introduced a baseball-inspired campaign that encouraged its coffee subscribers to join one of two teams based on their coffee preferences. It was massively successful for Death Wish Coffee, with loyalty-generated revenue increasing by 186%.
Progress bar or levels: Implement a visual progress bar or level system to show customers how close they are to their next reward. This motivates customers to continue engaging with your program.
Bonus Events: Offer bonus points for reaching milestones, celebrating a campaign, or completing tasks.

3. Personalized experience rewards

To stand out and retain customers, it is important to steer clear of all generalized program styles. The solution is personalization. Yes, you can indeed offer personalized rewards to your customers based on your customer data.

Personalized experience rewards are non-monetary and are based on individual customer behavior and preferences. It could be early access to newly launched products or services, discounts, etc.

Here are a few experience-based rewards you can offer your customers:

Personalized product recommendations: Use customers' past purchase history to offer customized product recommendations and rewards. You can also run email campaigns where loyal customers can sign up to get personalized recommendations every week or month.
Birthday or anniversary gifts: Send unique birthday or anniversary gifts to each customer. It could be discounts, a free product on a certain amount spent on the website, etc.
Custom rewards for frequent buyers: Create exclusive rewards for your most loyal customers in the top VIP tier. For example, frequent buyers could receive early access to new collections or exclusive products that are not available to the general public.
Tailored discounts: Offer discounts based on customers’ browsing history and wishlist items. By providing discounts on items they have shown interest in, you increase the likelihood of conversion.

Starbucks is a prime example of a personalized experience rewards program. The brand rewards its customers with perks, points, and freebies based on their preferences and past activity.

4. Streak Rewards

Streaks are a popular way of making customers continuously engage with your brand. Using the purchase streak technique, you can reward those customers who maintain a streak with regular purchases, regular logins, completion of certain tasks or have spent beyond a specific amount for every order.

This type of loyalty program incentivizes customers to keep coming back, creating a habit of frequent engagement with your brand.

Example of streak rewards ideas:

Consecutive purchase rewards: Customers earn extra points or special rewards for making purchases in consecutive months. For example, if a customer makes a purchase each month, they could receive double points in their second month, triple points in their third month, and so on.
Increasing rewards for longer streaks: Offer more substantial rewards for customers who maintain longer streaks of regular purchases. For instance, after three consecutive months of purchases, a customer could receive a free product or a significant discount on their next purchase. For a streak of six months, the rewards could be even more enticing, such as an exclusive product.

Boost retention with Shopify's innovative loyalty programs

No matter what type of loyalty program you choose, the strategies we shared with you above can help you transform your customers into loyal brand advocates. Be sure to utilize Shopify's powerful set of features and tools, like a Shopify loyalty app, for long-term success. With the right approach, you can drive impressive growth for your business.

Richard Nguyen, your friendly CRO Expert and tech guru at PageFly. Since joining the team in 2017, Richard has been dedicated to enhancing technology processes that make Shopify merchants' lives easier.

Innovative Shopify Loyalty Program Ideas to Increase Customer Retention

Table of Contents:

What is a loyalty program?

How do ecommerce loyalty programs work?