It’s no secret that brands, both big and small, are using rewards programs to entice past customers to return to their physical stores. If executed correctly, these programs can be inexpensive to implement and wildly effective at increasing repeat visits and customer lifetime value. How businesses treat customers throughout their journey will likely directly correlate with the customer’s decision whether to continue the business relationship moving forward. Every interaction matters — from the initial contact to the point of sale to the post-sales stage — you want to ensure you are delivering a satisfactory experience and rewarding those who frequent your business.
Early iterations of customer rewards mainly involved discounts on product pricing. BOGO (buy one get one) deals, discounted pricing for locals who bring ID to the store, cash-back deals, and free post-purchase add-ons are all classic examples of this approach. Today, plenty of programs still reward customers for in-store or online purchases. There is, however, an upward trend of businesses rewarding non-transactional activity. Antavo’s 2022 North America Customer Loyalty Report found that 87.5% of loyalty program owners planned to engage with customers in non-transactional ways in the next three years.
Businesses that are deploying these programs see the bigger picture. In terms of customer retention, there is far more to gain by rewarding actions that can drive brand awareness and foot traffic than by limiting these benefits to paying customers only.
Let’s explore some of the best customer rewards programs used by major brands with proven track records of increasing customer retention.
Tiered Subscriptions
Tiered subscription packages are great for businesses that want to have some flexibility in terms of what benefits they offer and to whom they provide them.
This system allows brands to provide a range of perks to customers at varying levels of loyalty. Frequent shoppers can invest at a higher price point to cash in on premium awards, while those who shop on an occasional basis can pay a small fee for slight advantages over those who do not sign up for the program.
Ulta, a well-known makeup and beauty brand, offers tiered rewards memberships to its shoppers. The free tier provides members with a free item during their birthday month. Members who pay extra for the Platinum or Diamond tiers get a free item in addition to a store voucher, higher reward points per dollar spent, and other benefits.
Gamifying the Customer Experience
Gamifying acts other than sales transactions keep shoppers authentically engaged with the brand’s initiatives. Similar to how games can bring joy to the player(s), a gamified rewards experience can increase customer delight and make customer loyalty fun and desirable.
This is critical in a competitive marketplace. With so many companies deploying customer rewards programs, launching unique interactive experiences is a great way to make customers ecstatic fans of your brand who are more than willing to tell their friends and family members about your business.
Photo entertainment website theCHIVE implemented a reward system and a ranked leaderboard tracking users with the most photo uploads to its site and shares across various social media channels. This concept emphasizes the aspirational value that the customer gets from the experience. Whereas a user might ordinarily use theCHIVE for a few uploads under the usual circumstances, the ranked leaderboard encourages them to change their behavior and upload more content in exchange for potential recognition from their peers.
Non-Transactional Rewards
Many companies implement rewards programs that are solely designed to reward paying customers. While it’s important to reward customers who are big or frequent spenders, a program that only rewards customers for transaction value is one that is missing key loyalty-building opportunities.
Transaction-based reward systems don’t have to be limited to price reductions on future purchases in exchange for upfront business. Many brands are testing variations of this strategy to optimize revenue growth potential and deliver better rewards to customers. Clothing manufacturer H&M, for example, offers points in exchange for purchases, but it also allows members to earn points for socially conscious acts like recycling old clothes or bringing a shopping bag from home.
Referral Programs
Word-of-mouth marketing still plays a major role in the era of digital acceleration. Some brands, such as Casper, have gone as far as to include it within their rewards programs through referral-based incentives.
As a direct-to-consumer mattress company, Casper promotes a powerful community by giving back to its biggest supporters. New customers receive confirmation emails after making their first purchases; within the footer section of these emails, Casper strategically places a catchy ad for its referral program that rewards customers with $75 Amazon gift cards for each instance of their referral link being used for purchase.
In this case, the company used an incentive other than points or store credit, which can be a great strategy to demonstrate your commitment to delivering quality rewards outside of your brand’s ecosystem.
About INAMAX
At INAMAX, we understand the importance of delivering experiences that promote customer retention and revenue generation.
We introduced the first redemption games system to hit the coin-operated amusement machine market. Today, the Titan Redemption System empowers players with a frictionless skill gaming experience. With the innovative Titan Card, players can replay winnings across different machines, store winnings for future play, or redeem winnings in-store.
Our retail partners leverage the Titan Redemption System to process route gaming transactions seamlessly. Command your customized dashboard to review insights into sales and service tickets and track redemption game categories to prevent overpaying on taxes.
To learn more about INAMAX and how the Titan Redemption System can deliver rewarding experiences to your team and your customers, please call us at 770.449.0400 ext. 700 or fill out our contact form found here.