Nowadays, loyalty programs seem to be an indispensable element for companies to retain their customers and optimize the customer journey. In this blog, we explore some of the best loyalty program examples.
What is a loyalty program?
A loyalty program is a marketing strategy used by companies to encourage customers to purchase products or services from them, rather than from competitors, and to reward customers for their loyalty. For example, companies may offer points or benefits, which can then be redeemed for discounts, free products or other perks. The goal is to build a long-term relationship between the customer and the company. In terms of use, the strategy is not limited to specific industries or companies. It can be used in virtually any industry that involves repeat purchases or customer engagement. However, the benefits of having such a program are enormous:
- Increased customer referrals
- Increase in sales
- Increased customer loyalty
Different types of loyalty programs
There are several types of loyalty programs that encourage repeat purchases and customer connection. We have listed some popular types.
- Points system: save points and exchange them for rewards.
- Cashback program: opportunity to recoup a portion of spending.
- Partner program: companies partner with other brands to offer joint loyalty programs.
- Community program: focuses on building a community around the brand through forums, discussions, events or online platforms.
- Pay-for-membership program: requires customers to pay a membership fee to gain access to exclusive benefits and privileges.
The most common rewards programs are points programs. Customers earn points based on their purchases and can later redeem them for rewards. These include discounts, gift cards or exclusive experiences. With these, customers receive tangible and measurable value for their loyalty.
Examples of loyalty programs
But how does that work in practice? To learn from others, we found some loyalty program examples. These are innovative programs you can take inspiration from.
Sephora
Sephora, a cosmetics store, is known for its Beauty Insider program, which is designed to harness the emotional drivers of loyalty. In fact, research has shown that some 75% of the drivers of loyalty and engagement are caused by emotions. Think of happiness, trust, surprises, but also pride. Here they work with the classic points system. However, they make it more personal by allowing customers to choose how they will use points. They also make it exclusive by creating different tiers. This way, customers have something to look forward to.
Starbucks
Starbucks was one of the first to implement a successful app. They used an existing app and used it to ensure that customers would not lose or forget their stamp cards. To earn Starbucks stars, customers must order and pay through the app. This is the ideal way for Starbucks to get to know the customer: they collect a huge amount of data. Then Starbucks can recommend a personalized drink or offer other additional benefits.
Amazon Prime
Amazon Prime is a well-known pay-for-membership program. For a flat annual fee, participants get access to free and fast shipping. As well as access to Amazon’s other services, such as their streaming service and Prime Day sales. With the huge competition in America, like Walmart, Amazon manages to differentiate itself with this. We also see this strategy at ANWB, for example. Both members and non-members can come and store, but members always pay a lower price and often get extra discount offers.
Albert Heijn bonus card
At Albert Heijn, customers can enjoy additional benefits with the Bonus card. Customers can opt for a free Bonus card, as well as a Premium version. As the supermarket gets to know the customer better, the customer receives personalized offers. In addition, savings can be made for Sales Stamps, Savings Stamps and Air Miles. Thus, the offers can be applied both inside and outside the stores (partner companies).
Ikea Family
The well-known furniture chain Ikea offers customers extra benefits and exclusive offers so they can enjoy their Ikea experience extra. The goal is to create a community. Customers can join “the family” for free and thus benefit from special offers. In addition, they enjoy other benefits such as free coffee, free product insurance and even a birthday gift. Members are also invited to special events, workshops and lectures at the store.
Texaco
With Texaco Stars, customers save per liter of fuel and every euro spent in the store or carwash. The customer can then exchange these points for vouchers. Think for example of free coffee, carwash or lunch, but also for fuel.
NikePlus
NikePlus is a loyalty program example that seeks to enhance the brand experience. It is so integrated that it is valuable for any (novice) athlete. Namely, they offer access to special events and free (exclusive) work-out sessions. Such events can take place in cities such as Barcelona or Berlin. Also, NikePlus collaborates with Apple. The Apple Watch Nike+ is a special version of the Apple Watch designed in collaboration with Nike. This version of the Apple Watch comes with special sports straps, additional Nike dials and exclusive access to the Nike+ Run Club app. In addition, customers will receive early access to new training equipment and personalized advice.
Pathé
Pathé Cinema offers the All Stars app that provides customers with a personalized movie experience and rewards them for their loyalty. With every movie ticket purchase or in-store purchases, users earn points that they can redeem. This can include free tickets, upgrades, and exclusive avant-premiers or other special events. Members are also the first to know about the latest releases.
Marriott
One strategy that is incredibly effective today is gamification. Through status levels, which earn them extra privileges, customers are rewarded. Every time a customer spends money at one of Marriott’s hotels, they get a better status. Each status level – there are about eight different levels – has different privileges associated with it. At level one, customers receive discounts on bookings, while at level three they also receive free room service and a welcome gift.
So, what is the best loyalty program?
Is there such a thing as “the best loyalty program”? In that case, everyone would proceed with the same strategy, which means no one would differentiate themselves from the competition. It is therefore essential to research your target audience and then choose a personalized approach. Read more about how to create a successful loyalty program!
