There are tons of loyalty programs out there, and you likely are a part of a few dozen yourself. From earning points at your favorite coffee shop, to your favorite brands, loyalty and rewards programs are part of the retail and commerce experience.
Being a member of loyalty programs, there are probably a few that you’ve either forgotten about, or have abandoned completely. There are a few reasons why consumers abandon loyalty programs, such as having a difficult time using them, a bad user experience, or simply the rewards are not worth the time and effort.
Building a brand community through a rewards program is the best way to retain customers, and keep them engaged through your loyalty program.
We break down 10 reasons customers are abandoning your loyalty program, and how to actually save them.
Team at Smile
Problem 1: Friction in joining your loyalty program
A major barrier for customers even joining your loyalty program in the first place is that it can be just too difficult. Nothing is more frustrating than shoppers being put through multiple touch points and clicks to create an account.
Customers, both online and offline, are looking for convenient shopping solutions that can deliver value quickly and easily. Friction points for customers can lead to program abandonment, if they can't find where to sign up for your loyalty program, or if there are too many input fields.
A sign up process that requires customers to fill out extensive forms or navigate through multiple pages will be a real turn-off that could prevent your customers from even giving your loyalty program a chance.
Solution: Simplify your sign-up process
The best solution to eliminating sign-up friction is to minimize your registration form and only ask for information that is easy for customers to give away. Such as first and last name, email address, and one more field if needed.
A great example of a simple sign-up process is cookie brand PNW Cookie Company. Their loyalty program is easily accessible the moment you land on any page of their website. Through Smile’s accessible loyalty program launcher panel, a customer can easily see there is a loyalty program they can join.
Customers are only asked to create an account with four form fields, first and last name, an email address, and an account password. Simple to find, and simple to join.
Problem 2: Loyalty program structure is confusing
Points-based loyalty programs are a common loyalty program structure across commerce industries, which means your customers are likely already very familiar with the basics of how they work. This familiarity lends itself to easy adoption and encourages customers to join your program, but only if you keep it simple enough.
Too often ecommerce brands try to spice up their loyalty program by adding new rules and complicated conditions on how to earn points. Instead of generating excitement it just frustrates shoppers, making it difficult for them to engage with the program, and leaving altogether.
Solution: Design a comprehensive explainer page
When it comes to reward programs, there’s no reason to reinvent the wheel. Points-based loyalty programs are still successful because it’s easy for customers to understand the value they can receive, in exchange for a purchase. With this in mind, the best way to take your program to the next level is with a well-designed explainer page.
Gabrielle Policella
A dedicated program page like this one from skincare brand Naturium gives you the chance to clearly define how your program works. This eliminates any confusion customers could have about how your rewards program functions, and how to earn and redeem rewards. More importantly, it clearly shows them what value it’s offering them, motivating them to join your program and start engaging with it.
Naturium gives customers an in-depth look into their loyalty program
Problem 3: Bad user experience
The basics of a well-branded ecommerce site is that the user experience should always be top of mind. With so many different ways customers can shop online, customers have grown accustomed to good design and responsive interfaces across all devices.
That makes it completely unacceptable to run a loyalty program that looks like it hasn’t been made a priority. Broken links, an unbranded design, and programs that look disconnected from the rest of your customer experience are ways to lessen the appeal of joining your brand community.
Solution: Provide a branded experience
Create and provide a branded experience from beginning to end. Putting your brand front and center can be the difference between customers trusting your program or walking away from it. When they see a logo and colors they recognize attached to your program, they’ll automatically associate the good feelings they have for the rest of your brand with what you’re offering through your rewards program.
This makes it imperative that your program be properly branded from top to bottom. This includes logos, colors, and both text and icon customization that makes this clearly your brand’s rewards program. Blume is the perfect example of curating a loyalty program that evokes a feeling of wellness, and calmness that is associated with Blume’s products.
Choosing a best in class rewards program solution that allows you to customize each of these features will make your job easier, your customers happier, and your program be quick to launch.
Problem 4: offering unappealing rewards
While your customers might be interested in the same types of products, they’re not all interested in the same kinds of rewards. Just because dollars-off coupons work for some of your customers doesn’t mean they’ll appeal to everyone.
Offering only one type of reward can paint your loyalty program into a corner by lowering its perceived value for prospective members. This is particularly dangerous for brands that exist in highly competitive, discount-driven markets like cosmetics or supplements.
Solution: Diversify your available rewards
A simple solution to enhance your rewards and loyalty program is by diversifying your available rewards that customers can redeem. Test different types of rewards and see which are often redeemed through your analytics dashboard.
Combining transactional rewards with experiential ones will help your program stand out. You can mix rewards like discounts and free products with less tangible but equally valuable rewards like early access to sales or being part of the product development process.
Whatever way you do it, giving customers a choice automatically increases the appeal of joining your program and adds a level of customization that customers crave. Offering your customers options for how they can redeem their rewards can go a long way to improving your customer experience and program engagement, and ultimately your customer retention.
Problem 5: Program rules change too often
Another reason customers abandon your loyalty program is if your program rules often change. Just when a customer is getting used to your program, an unannounced change can be a way to get users uninterested and confused.
Even though reward programs are not a set it and forget it tool, that doesn’t mean you should be bombarding your members with changes. While change is sometimes inevitable, the more of it you have the less stable your program looks. This perceived instability can shake member confidence in your brand community, preventing them from enjoying the improvements you’ve made.
Solution: Provide effective communication
A great loyalty program is constantly evolving with your customers, and as your business grows. Even for the best reward programs, change is inevitable and is more often than not a good thing! With this in mind, the best way to get in front of these “disruptions” is to communicate them clearly to your members.
Often the problem isn’t with the change itself but rather the lack of communication. Let your customers know what is changing, how that change impacts and benefits them, and what they can expect from your program in the future. You can do this through social media, email, or customer support.
The important thing is to clearly explain the changes and continue to show customers that they are valued members of your brand community, no matter what changes are made! Riversol did a fresh loyalty program relaunch last fall and walked customers through what changes they can expect, and what values it holds for them.
Problem 6: Stale program marketing strategies
Another reason customers are abandoning your loyalty program is because it might have gone stale. No communication, no innovating program changes, or updated rewards, can lead to your loyalty program members feeling unmotivated. No matter how great your everyday offers are, customers will eventually get bored. Rewards are only exciting when they still hold value.
Solution: Bonus point events
A valuable way to inject a bit of excitement into your program is with bonus points events. Since customers won’t be expecting them, bonus events give you the chance to create truly rewarding experiences for your community members.
‘Bonus Points Event’ are simply when you multiply the number of points a customer can earn during a specific timeframe. For example, you can offer double the points on all purchases for a single weekend, celebrating a new product release or your brand's birthday. Customers are incentivized to shop and earn more points, maximizing their reward balance, which can be spent on a second purchase.
Jonathan Roque
Bonus points can be used to spice up the value your program has to offer without requiring you to completely restructure your program.
ECS Coffee is a perfect example of using bonus points campaigns to get customers to earn more on purchases during their select campaigns. ECS Coffee creates several bonus points campaigns throughout the year, offering 5x the points on purchases. A few weeks later, they create a double redemption campaign. Users who have earned multiple points on the previous event can now redeem their points at a higher value.
Problem 7: Members forget they’re enrolled
With loyalty programs being a common ecommerce component, it can be easy for your rewards program members to forget they’re enrolled in your program in the first place. Even your most valuable customers can forget about their points balance, or any rewards they can redeem.
Solution: Send behavioral email marketing
A simple way to remind people that they’re enrolled is to simply remind them! Incorporating behavioral emails into your marketing strategy is the perfect way to meet shoppers at every stage in the customer journey.
There are a number of powerful email tools that can integrate with your rewards program to help you set up email campaigns that target customers who haven’t revisited or engaged with your brand in a while.
The new Smile.io and Klaviyo integration allows you to send these 8 events, to start:
• Birthday reward issued
• Points earned on orders
• Points redeemed
• Points expiring
• Referral started
• Referral completed
• Reward expiring
• VIP tier achieved
This incentive creates more ways to draw them back into your brand community and re-establish ongoing engagement.
Matt Hennessy - Smile.io Staff SW Engineer
Problem 8: Members have issues redeeming their points
If your loyalty program members have issues redeeming their points, they can leave altogether and could impact cart abandonment. Technological hiccups and related program issues are extremely detrimental to your customer experience, and will leave customers questioning whether they can truly trust your loyalty program, and depend on your brand.
Solution: Choose a reliable platform
Choosing a loyalty program provider that can stand up under pressure will do wonders for the reputation of both your program and your brand as a whole. Select a best in class loyalty platform that can deliver results, and help you launch quickly.
When you select the best in class loyalty program software, you have experts backing your business, and loyalty program. When it comes to all-in-one tools, you are left with one tool that does multiple things. The teams behind these tools can be viewed as generalists who are in charge of the return on investment for that tool and its functionality.
All-in-one solutions (and the people behind them) have the possibility of lacking depth or specialization in one area since the main focus is to do a lot with one tool. Additionally, the all-in-one approach can lead to a higher upfront cost, and businesses might end up paying for features they don’t necessarily need
Jonathan Roque
Problem 9: Customers don’t know what they’ve earned
When you don’t know how close you are to reaching a goal, it can be very hard to stay motivated. If your customer doesn’t know what they have earned, or how many points they are away from a reward, customers can quickly become disillusioned.
While points are valuable within the context of your program, customers can easily lose track of how many they’ve earned or how many they need to take advantage of the awesome rewards you offer. Without these types of benchmarks, it’s difficult for customers to remember why they joined in the first place, leaving your points and program viewed as trivial instead of valuable.
Solution: Display customer’s status
Showing customers how close they are to their next reward or moving up a VIP tier is an incredibly easy and impactful way to motivate them to continue engaging and can be done with almost any rewards program.
When members can see how close they are to their next achievement, their efforts become much more tangible as they’re reflected in your program. You can see this at play in Footprints USA’s VIP loyalty program. In this example, a customer can view how far they are to reaching the next VIP level and can track their progress with a visual progress bar.
By reminding customers of the time and effort they’ve already invested in your program you help drive them to reach their next goal. Additionally, they will be regularly reminded about the perks and rewards they can attain with just a little bit more investment. As a result, they’re also infinitely more valuable, having boosted their desire not just to keep coming back, but be actively engaged in the loyalty program.
Problem 10: Increasing competitive alternatives
As retention marketing continues to play an important role in scaling ecommerce brands, the biggest hurdle for your rewards program will be that everybody else also has one. This means that if at any point your program doesn’t meet their expectations, they’ll be able to find a brand that can. With so many options to choose from, your program can easily be lost in the shuffle.
Gabrielle Policella
Solution: Commit to your rewards program
At the end of the day, the success of your loyalty program comes down to your priorities. The more time and energy you invest in it, the more your customers will be able to see how much you value them and their commitment to your brand.
This includes putting the people and systems in place to help your program run smoothly. While launch managers and a well-informed support team are especially helpful, they’re not always necessary! No matter the size of your brand, your rewards program has the potential to elevate your customer experience above that of your competitors, making it a truly invaluable part of your brand that customers can’t wait to experience.
Bring customers back
Keeping customers interested in your program doesn’t have to be a daunting task if you know what’s driving them away. By adjusting and evaluating a couple of key areas in your loyalty and rewards program, you can easily bring your loyalty program back up to code and help your customers find additional value with each transaction and interaction with your brand community.
