A loyalty strategy that doesn't suck
Loyalty programs for ecommerce. The last thing anyone wants to think about, and for good reason.
Growth-at-all cost has been the in vogue aspect for emerging brands since the heyday of 2016. The old trope of CAC isn’t getting any cheaper couldn't be more true now and merchants more and more need ways to get customers a meaningful way to come back to make a repeat purchase. Some have tried loyalty programs and wonder why it’s not really working.
Here’s the thing. Points loyalty programs suck. Like really bad.
But if you make ONE subtle shift, they can double your repeat purchase rates, keep customers on subscription longer, and convert one time purchase customers (OTP) to subscribers.
Your heart is in the right place. Reward your customers for their purchases, they can use their rewards to come back and purchase again. Kohl's Cash still crushes every single GenXer in middle america so it sure as heck can work for your brand too.
That’s the thing. Cash.
Not cash-chargebacks to the customer. Cash-Back store credit. That’s what’s driving customer behavior.
Customers understand the value of that reward and thus take action on it. Saying I have $8.90 in rewards is waaaaay more impactful than saying I have 890 points. I’m pretty sure 890 points in my amex rewards wouldn’t even buy me a banana at a motel 6. Customers feel the exact same way.
The beauty of this is you can still run a simple rewards program with one subtle shift. Just use an app that does store-credit cash-rewards vs points. Super easy.
Keep the value, give a % back in store credit (2-5% depending on your margin), maybe even bump it up for subscribers to make it pop
Auto-deposit a $5 credit into your customers account during a promo period and watch your customers spend. Way more impactful than a 20% off discount (because customers get those every single day and are numb to it)
Opens up a brand new way of communicating with your customers in the lifecycle. Expire the credits, tier the credits, give the credits for redemption for product.
But just do it in cash-store-credit. Ditch points.
If you’re a hard-or-soft goods brand, Rivo is a great option.
If you’re CPG/Beauty/Pet/Consumables - Skio’s is the best one to check out.
Jack Dohey
PS - Hey, I'm Jack - Based in NYC and in ecom the past decade - ran my own brand for 5 years and worked with enterprise merchants the past 5 - excited to share my war stories and insights I learn from other top merchants along the way - connect on Linkedin!