Businesses constantly seek innovative ways to retain customers and amplify brand loyalty. One effective strategy that has gained popularity is implementing a point reward system for your store.
A well-implemented point reward system boosts the shopping experience for 58.7% of customers, who find earning loyalty points to be valuable. Imagine the positive impact that could have on your bottom line!
This system incentivizes customers by providing loyalty reward points for engagement. These customer loyalty points can then be redeemed for discounts or other perks. But, getting started with such a point-based reward system might seem daunting at first. Don’t worry, though!
In this blog, we’ll explore how implementing a reward program can benefit your business and provide step-by-step instructions on how to implement effective reward and recognition strategies. Let’s begin.
Increase your ROI up to 30X with WPLoyalty’s seamless loyalty point reward system.
What is a Point Reward System?
A point reward system is a powerful customer loyalty program that incentivizes repeat business and strengthens brand relationships. Customers earn points for their purchases and engagement, which they can then redeem for exciting rewards like discounts, free products, exclusive experiences, and more.
The Power of Loyalty Points:
The core principle behind a point-based reward program is simple: the more customers interact with your brand, the more they’re rewarded. This not only encourages repeat purchases but also fosters deeper customer connections. These loyalty points can be implemented in different scenarios such as points and rewards systems for customers, employee recognition points, or membership point systems.
Eventually, implementing a reward points system effectively turns casual buyers into committed brand advocates, enhancing customer satisfaction and retention over time.
Reward loyalty points easily for various customer engagements from WPLoyalty’s pre-built loyalty campaigns.
How to Design Your Point Reward System
Designing a point reward system is an exciting opportunity to make a program that your customers will love. There are different contexts in setting up a points-based reward system. You can set it up for employees or customers, and in our case, for “Customers.” The following are the key elements of a successful Points Reward System.
A. Earning Points:
- Points for Purchases: The foundation of any good reward system. Offer points for every dollar spent or for specific items purchased. This encourages customers to increase their spending to earn more points.
- Points for Engagement: Go beyond purchases by rewarding customers for engaging with your brand. This can include actions like writing reviews, referring friends, social media shares, or signing up for newsletters. It’s a great way to build a community around your brand and keep your customers engaged.
- Bonus Points & Promotions: Keep the program exciting with occasional bonus points, promotions, or double points days. These can be tied to holidays, customer birthdays, or as a surprise to keep the interest high. Bonus points can act as an incentive for customers to take actions they might not otherwise consider, such as trying a new product line.
B. Redeeming Points:
- Offering a Variety of Rewards: Ensure your rewards catalog is diverse and appealing. Include options ranging from discounts and free shipping to exclusive items or experiences that can’t be bought. A varied rewards portfolio caters to different customer preferences and makes your program more attractive.
- Setting Clear Redemption Tiers: Implement a tier system where the value of rewards increases with the number of points redeemed. This method encourages customers to save points for higher-value rewards, increasing their engagement and loyalty over time. Communicate how many points are needed for each tier to keep customers informed and motivated.
- Making Redemption Easy and Accessible: The redemption process should be straightforward and user-friendly. Customers should be able to easily see their points balance, understand what rewards they’re eligible for, and redeem points with a few clicks. Consider integrating the reward system into your website and mobile app to make access as convenient as possible.
Once you have done this, you need to provide different options to redeem those loyalty points. By following these outlines, you can design a point reward system that can incentivize customer loyalty. Next, let us look into how you can create an effective point reward system.
How to Set Up a Point Reward System in WooCommerce?
You can easily create a point-based reward system using a simple yet effective WooCommerce points and rewards plugin – WPLoyalty. This tool allows you to reward points for every action your customers make at your store.
Apart from points, there are four other reward types, fixed discounts, percentage discounts, free products, and free shipping.
But now, let us create a ‘Point for Purchases’ campaign and a ‘Point Conversion’ reward that helps customers redeem the points for a discount.
Step 1: Install WPLoyalty
Firstly, download the WPLoyalty plugin and activate it. Once downloaded, go to your WordPress Dashboard -> Click on Plugins -> Add New -> Upload Plugin -> Choose the WPLoyalty file -> Click on Install Now.
Have a look at the screenshot for a better understanding.
Step 2: Create a “Point for Purchase” Campaign
In this example, let us create a “Point for Purchase” Campaign where customers will get 1 point for every $1 spent.
For that, Go to your WordPress dashboard -> WPLoyalty -> Campaigns -> Tap on “Create a New Campaign” -> Choose the “Points for Purchase” campaign type.
Fill in the necessary fields as shown in the screenshot above and click on save and close. The “Points for Purchase” campaign was created successfully.
Step 3: Create “Point conversion” Reward Type
After creating the campaign, let us now create a “Point conversion” reward type. In this example, customers can redeem 500 points for a $5 discount.
For that, go to your WordPress dashboard -> WPLoyalty -> Rewards -> Tap on Create a new reward-> choose the Points Conversion reward type.
Fill in the necessary fields as shown in the screenshot above and click on save and close.
Once configured, customers can earn points through the “Points for Purchase” campaign and can redeem 500 points for a $5 coupon.
Tip! Store owners can also offer coupons, free products, free shipping, cashback rewards, etc when customers redeem their loyalty points.
How do Customers Discover their Reward Points?
WPLoyalty allows your customers to easily discover their reward points. On the shop page, points are displayed below the product image.
Also, customers can view their earning opportunities and rewards under the chat-like launcher widget in the bottom right corner.
These ways will help customers to know how many points they can earn on purchasing a specific product.
Implement your points and rewards system with WPLoyalty’s seamless pre-built campaigns
Different Ways to Reward Customers with Loyalty Points
There are different ways you can reward your customers with loyalty points. Here are various effective ways you can use loyalty points to increase repeat purchases
- Points for purchases: You can reward customers with loyalty points based on their purchase history. For example, customers could earn one point for every dollar they spend, with points redeemable for discounts, free products, or other rewards.
- Points based on spending: You can encourage customers to spend more by offering them bonus points for reaching certain spending milestones. For instance, you could give customers 100 bonus points when they spend $500 or 500 bonus points when they spend $1000.
- Points based on achievements: Consider recognizing and rewarding customers for their loyalty by offering them points for completing specific achievements like moving up a level in tier-based loyalty programs, etc.
- Points for referring friends and family: Encourage customers to refer their friends and family to your business and reward customers for referrals with loyalty points. For example, you could offer customers 500 points for every new customer they refer who makes a purchase.
- Points for sign-ups: Offer customers bonus points for signing up for your eCommerce store. It could be a one-time bonus, such as 100 points.
- Points for writing product reviews: Encourage customers to share their experiences with your products by offering them loyalty points for writing reviews.
- Points for customer birthdays: Celebrate your customers’ birthdays by offering them bonus loyalty points. Show them that you value their business to foster a deeper sense of loyalty.
- Points for sharing products on social media: Encourage customers to share your products on social media by offering them loyalty points for doing so. It helps to increase brand visibility and can lead to more customer acquisition.
- Points for following your social media page: Reward customers for engaging with your brand on social media by offering them loyalty points for following your page.
Real-Life Successful Point Reward System Examples: Case Studies
Most e-commerce brands have mastered the art of customer loyalty with their innovative point reward systems. Here are the best three-point reward system examples:
Sephora’s Beauty Insider point reward system
Sephora’s Beauty Insider program allows customers to earn points for every dollar spent, which can be redeemed for exclusive products, discounts, and more.
Why is it successful?
The success of Sephora’s points system lies in its ability to make customers feel valued and excited to spend more. Due to this, customers tend to eagerly make repeat purchases.
Starbucks point reward system
Starbucks uses a star-based point reward system where customers earn stars(Points) for every purchase made with their registered Starbucks card. Stars can be redeemed for free drinks, food items, and more.
Why is it successful?
Starbucks’ reward system thrives on its simplicity and the instant gratification it offers. By personalizing rewards, Starbucks keeps customers engaged and incentivized to return.
Ulta Beauty’s Point reward system
Ulta Beauty’s Ultamate Rewards program allows customers to earn points for every dollar spent on products, salon services, and more. These points can then be redeemed for discounts on future purchases.
Why is it successful?
Ulta’s rewards system is effective because it offers customers immediate value with points that translate directly into savings on purchases. This approach encourages repeat business and enhances customer satisfaction within a short time.
Benefits of Implementing a Point Reward System
Rewarding customers with reward programs is crucial for any business looking to strengthen its relationship with customers and enhance its overall growth. Here’s why creating a loyalty program and implementing such a system is beneficial:
a) Point Reward System Encourages Repeat Business
A point reward system motivates customers to make more purchases. By earning points for each purchase, customers have a tangible reason to return to your store rather than shop with competitors. In this way, you can boost sales with customer loyalty program.
We can take Starbucks’ Rewards Program as a prime example. Customers earn stars (points) for every purchase, which can be redeemed for free drinks and more. This point reward system encourages customers to choose Starbucks over competitors for their coffee fix, increasing repeat visits.
b) Builds Strong Customer Relationships
When customers are rewarded for their loyalty, they feel appreciated. This emotional connection makes them more likely to stick with your brand long-term. It transforms ordinary transactions into parts of a rewarding relationship.
For example, Sephora’s Beauty Insider program rewards customers with points that can be exchanged for exclusive products and beauty experiences. It makes customers feel special and deepens their emotional connection
c) Point Reward System Enhances Customer Engagement
Points can be earned not just through purchases but also by engaging with the brand on social media, writing reviews, or referring a friend. This multi-level engagement keeps your brand at the forefront of customers’ minds, encouraging customer retention.
d) Simplifies Targeted Marketing Efforts
A point reward system can provide detailed insights into individual customer preferences and buying habits. This information allows for more targeted and personalized marketing efforts.
e) Point Reward System Increases Customer Lifetime Value
Customers who are part of a rewarding points system are more likely to stick with your brand over the long term. By increasing the frequency and amount of their purchases, these loyal customers significantly contribute to your revenue.
Retain your customers easily by including them in WPLoyalty’s point reward system in your online store.
Conclusion
Creating a point reward system is an exciting way to keep your customers happy and coming back for more. By following these simple steps, you can design and create an effective point reward system that fits your business and makes your customers feel appreciated.
Define the objectives, set point values or establish a points structure, choose redemption options and rewards, design the system, promote it, and monitor performance for improvements.
Customers earn points for actions like purchases and engagements. They can redeem points for rewards such as discounts or free products, incentivizing loyalty and engagement and this is how a point system works.
Clear objectives, point values, redemption options, and a user-friendly interface are essential for an effective reward system and a good reward point structure.
The most effective reward system varies depending on the business and its customers. Systems with clear goals, easy-to-understand point values, and attractive redemption options tend to perform well.
Some of the types of point-based reward programs include customer reward points for purchases, employee recognition points systems, or a membership-only point system.
