Providing incentives for loyal customers has more benefits than you may think. You want to have a system that helps you reward customers for loyalty. When you have an effective loyalty program, you can deepen your customer relationship. We’re going to break down how to create a loyalty program.

1. Name Your Program

Your rewards program should have a name that’s easy for the customer to remember. For example, Starbucks is the Starbucks Rewards program. The program name is simple and it gets the message across. Many companies use their name as the rewards program but this doesn’t stop you from getting creative.


2. Multiple Signup Approaches

You should have a variety of ways your customers can get started with the rewards program. For instance, allowing to sign during a purchase to save money. Promoting on social media and allowing customers to sign up through various channels. By having multiple channels customers can engage, your increasing engagement potential.


3. Decide What Actions Earn Rewards

Take time and brainstorm on what actions will earn rewards for the customer. For example, Wild Rye Cafe Bakery does a great job of managing their rewards program. I would visit this place at least once a week because I knew after a certain amount of visits I would get a free lunch. Although their shop focused on shopping frequency, figure out what actions you want to reward. Experiment with rewarding different customer actions. Ultimately you want to find a good mix that motivates your customers to increase frequency.

4. Must Add Value

Your reward program must add value to the rewards member. For instance, think about how this program will make the customers better off. Develop messaging that stresses the benefits of becoming a member. Notably, Amazon makes the decision a “No Brainer” by offering so many benefits. You get Free shipping, tons of movies, free grocery delivery for a $100 annually.

5. Provide a Variety of Rewards

Create a program that provides a variety of experiences. For example, Nordstrom does a phenomenal job of providing members variety. As a member, you get to shop new brands before everyone else, get rewards points back that count as money and more. Their members have several ways to benefit from shopping often with Nordstrom.

Ultimately building a program that rewards customers will drive loyalty. By offering value to your biggest customers, you’re building brand loyalty. In conclusion, regardless of how you build your loyalty program, focus on the customer’s benefit.

Alex Brooks is the founder and CEO of AE Brooks, LLC (d/b/a, Entreprov), a Seattle-based firm that builds custom tools to help businesses increase customer retention and engagement. Sign up for our newsletter to learn more customer engagement strategies.