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Tips for a Successful Rewards Program

Tips for a Successful Rewards Program


The goal of a customer loyalty incentive program is to increase sales. Loyalty marketing and loyalty incentive programs focus on growing and retaining existing customers through incentives. Here are some tips for creating successful Loyalty & Rewards Programs.

Track and Test

When you’re creating a loyalty incentive program it’s as important to find a program your customers will respond to as it is to choose the rewards. Most loyalty incentive programs revolve around current customers providing referrals, how much a customer spends, how long they’ve been a customer or how often they engage with a company. Keep track of customer interaction with your program. If you’re not getting the desired response keeping track will give you the information you need to make changes.

Reward Outside the Box

Some business sectors have typical rewards that are offered through their loyalty incentive programs. If there are typical rewards that exist for your business sector go outside the box and offer a different type of reward. This will differentiate your business from competitors. For example; many financial and real estate institutions offer savings incentives for providing referrals. Providing a gift (Ham or Prime Rib Gift Coupon) for a qualifying referral would be an appreciated reward that is outside of current industry norms.

Offer Reachable Rewards

Clients will give up on customer incentive programs when reward redemption appears difficult. A loyalty incentive program that presents achievable goals will engage more customers. An ideal program is one that rewards sooner rather than later. Take time to consider redemption from your customers’ point-of-view and plan accordingly.

Sales Charts Climb a Tiered System

Providing a tiered rewards program is a good way to establish a base offering and encourage repeat customers and business. Building upon the value of the initial reward can also add value to customer experience. If you want customers to prolong their interaction with your business it’s important that additional tiers be within reach.

Research Rewards

Find out what competitors are doing. Contact customers and ask them about what they want. Contacted customers should represent your core business or new demographics you want to reach to. These efforts, combined, should provide information about what may work for your own loyalty incentive program.

Educate and Engage Your Staff

Explain new loyalty incentive programs, and their win-win components, with staff. Staff will appreciate inclusion. Staff that understand the win-win are more likely to engage customers about new loyalty incentive programs. Customers will appreciate staff who can explain things they might not understand.


The first large scale loyalty incentive program in the USA was the 1896 S&H Green Stamps program. Stamps and stamp books were sold to businesses who gave them to customers. Customers collected stamps, stuck them to the books & redeemed them for rewards.

Communicate with Customers

Use multiple channels of communication when informing customers about your loyalty incentive program. Your employees and sales team are often your best advocates. They are usually the ones your customers have the most contact with. POP signage, emails, a website presence, and presence within traditional marketing and advertising are equally important channels of communication.

Use a Simple System

Loyalty incentive programs that are based on simple systems work best. Simple systems are easy to explain and easy to understand. Simple systems are less likely to tie up employee or customer time with lengthy explanations clarifying how a system works.

Offer Benefit through Upfront Fees

Some programs benefit by requesting a fee that lets customers bypass common purchase barriers. The fees can be annual or one-time fees. Identify barriers that may cause customers to leave and create your fee-based program to bypass these barriers. Purchase barriers do not need to be complicated and should not be convoluted.

Provide Non-Monetary Programs Around Your Customer’s Values

Communicate with your customers and find out what they value. Saving money on a product or service is always nice but can become cliché. Presenting rewards to your customers that go beyond currency or savings shows that you better understand them. If you don’t know what your customers value, ask. If what they’re interested in is unattainable there may be suitable middle-ground that will benefit your loyalty incentive program and them.

Make a Game Out of It

Turning your loyalty incentive program into a game is a fun and engaging way to interact with customers. Loyalty incentive programs presented as a game can stand out against competing programs. It can also take the brain strain out of participating and make it more likely that customers will engage.

Understand Hard and Soft Benefits

Hard benefits, the actual reward, are what most loyalty incentive programs focus on. Soft benefits, add-ons that complement the initial reward, help build rapport with customers. Understanding and being able to communicate both can benefit all. An example of a hard benefit is receiving a Grilling Gift Coupon with a purchase of a cooking appliance. A soft benefit would be offering customers an opportunity to attend or view a special grilling cooking class by a local chef.


Promote your loyalty incentive program offline (brochures & signage) and online (Email updates, social media, website, etc.) with consistent messaging and imagery.

Incorporate Mobile & Tablets

Mobile phones and tablets should always be within your sights when you’re planning your Loyalty incentive program. Loyalty incentive program apps, sms text messages, mobile and tablet friendly websites or app related rewards are a few ways to engage customers. SMS text messaging customers should be limited.


  • The financial services sector is the biggest provider of rewards
  • The travel and hospitality sectors are the second largest provider of rewards.
  • The Retail industry makes up 40% of all loyalty incentive program [/message_box]

Everyone Appreciates a Head Start

Punch cards can provide good incentives to keep customers coming back. Giving a customer an artificial head start can provide additional incentive. For example; if five punches are required to get a free sandwich consider giving your customer a punch card with 1-3 punches already in it. Better yet, let them see you give them the head start. This can make a difference between a punch card eventually finding itself in a recycle bin or the customer bringing it in sooner!

Part of but not the Equation in its entirety

Good service, products and fulfilling customer experiences are vital to creating customer loyalty. A loyalty incentive program should accent those things your business is already doing right. Loyalty incentive programs should never be the sole methodology for creating customer loyalty.

Keep Customers in the Loop

According to the National Business Institute over 50% of loyalty incentive program members claim they don’t receive contact from anyone after joining a loyalty incentive program. A successful loyalty incentive program shouldn’t conclude with its launch but include a follow up plan that lasts through its completion.

Integrate Popular Rewards

Never underestimate the effectiveness of a popular reward. It makes perfect sense to integrate something with popular interest into a program you want to remain popular. Ham gift Certificates and certificates and turkey gift Certificates and certificates remain one of the most popular reward and incentive gifts in the US.

Provide Exclusivity

Offer members something that non-members don’t have access to. Exclusivity is often viewed as highly personal and can help build emotional connections with customers. Free shipping, access to multiple business locations, VIP seating or backstage access to events are examples of exclusivities that present added value to loyalty incentive program members.

Social Circles

Create ways for your loyal customers to communicate among themselves. Social circles include online social media communities surrounding your Loyalty and Rewards program. Do not forget about special on-site events, webinars and other functions. These communities give customers platforms and can encourage current members to enlist friends.

Be App-propriate

Smartphone use continues to be on the rise in the US and worldwide. Building an app for your loyalty incentive program, or combining your loyalty incentive program with apps already in use is a great way to engage and connect with your customers. You can combine a program with Check-In apps, like Foursquare, to offer rewards when they check-in to your business. In return, people they are connected with will also see your business name within the app or via plugins that announce their check-ins on Facebook, and twitter, etc. that meets your needs!


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One thought on “Tips for a Successful Rewards Program

  1. I like how you say that a good incentive program has some form of exclusivity. It would make sense to consider what kind of rewards are available for those that participate in the program. Talking about it with your employees to see their opinions would probably give you a good idea as well.

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