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Everything You Need To Know About eCommerce Loyalty Programs

The world of eCommerce keeps expanding every day, and in order to stand against the vicious competition, you need to offer real value for customers. Your goal should not only be finding new customers who will buy from you instead of all the other competitors but also for them to keep coming back and not leave you to another competitor later on.

One very important way to achieve that is through eCommerce Loyalty Programs or loyalty marketing. In this article, we will provide you with Everything you need to know about eCommerce Loyalty Programs and why you should start using them to boost revenue and grow your business. 

Table of contents:

What are eCommerce loyalty programs?

eCommerce loyalty programs

A loyalty program is an eCommerce marketing strategy to keep existing customers engaged and willing to buy more frequently and in larger quantities.

A loyalty program is a rewarding system for your customers to stick with you and not leave you for other competitors and in some cases to even turn into brand advocates and help you acquire more customers. A loyalty program report published by Bolt stated that 83% of online shoppers are a part of at least one loyalty or rewards program. 

Why should you implement an eCommerce loyalty program?

here are 7 benefits of eCommerce loyalty marketing:

1- Boosting revenue

Loyalty programs increase profits because they improve:

To make it simpler, loyalty marketing makes the same customer buys more and in larger amounts. This means more orders with bigger value, and consequently, this customer will be bringing in more money annually and during their "lifetime" with your business (CLV).

It also means customers are unlikely to churn, and if they do, it will be after a long time because of loyalty programs. This means the money won't stop coming from that customer anytime soon. 

2- Encouraging the word of mouth advertising

word of mouth advertising

Word-of-mouth advertising is super powerful. According to Forbes, 92% of consumers say that they trust word of mouth and recommendations from friends and family more than they trust any form of advertising. With loyalty programs, your existing customers will turn into brand advocates telling their social cycles about your business. That's not only FREE marketing but also incredibly effective marketing. 

3- Differentiating the brand from its competitors

The eCommerce industry keeps expanding every day, and the competition is vicious. One way to stand out in the crowd is to offer your customers a unique and enjoyable experience. Build a loyalty program that makes your brand special and offers a remarkable value and experience for your customers.   

4- Building Customer Loyalty

Loyalty programs boost customer loyalty because it shows customers that you appreciate them and that you are willing to give, not only take. It creates strong brand allegiance, and those loyal customers will help your business grow. According to Invesp, almost 64% of retailers say that the loyalty program is the best way to connect with their customers. 

5- Saving on customer acquisition costs

Acquiring new customers is not only challenging but also expensive. Marketing costs keep increasing every day, and the ROI is undetermined. With loyalty marketing programs, you save up on these costs because the same customer will bring in more money, as we have explained above. Moreover, through word of mouth from loyal customers, you can acquire new customers for free! 

6- Collecting valuable insights through surveys 

With loyalty marketing, customers can be more enthusiastic about filling in surveys and providing valuable insights about your business. You can utilize loyalty programs to offer points or discounts when customers fill in surveys about customer experience, customer service, product quality, and other important data you need to collect. 

7- Building up your reviews and testimonials pages


Again, with a good rewarding system in place, your customers will be encouraged to submit reviews and testimonials in return for points or discounts. Social proof is extremely important in acquiring new customers, and it is one great strategy for conversion rate optimization

Types of eCommerce loyalty programs

Types of eCommerce loyalty programs

1- Points programs

This program rewards customers with points depending on each action taken. For example, ordering, buying for a minimum value, sharing social profiles, subscribing, leaving a review, recommending to a friend, etc. These points can be redeemed later for money, free items, or discounts. 

2- Paid/subscription programs

One clear example is Amazon Prime. With a subscription fee, the customer gets access to special offers, discounts, and unique services like free and fast shipping. 

3- Tiered loyalty programs

Tiered loyalty programs give customers the ability to unlock more privileges by reaching higher levels. Each level offers more prestige and better benefits. Going up through levels can be based on points or other criteria you define. The reason this loyalty program type is effective is that 74% of customers are motivated to be loyal when they work toward a reward. Furthermore, 78% of customers become loyal to a brand if they’re both rewarded and recognized for their loyalty.

4- Universal loyalty programs

Instead of building your own loyalty program, you cooperate with a universal loyalty program by a discounts/promotions/shipping company or similar. For example. This way customers can use the loyalty program they have with your brand and other businesses as well. One example is again Amazon prime. They can benefit from the program with multiple vendors.

Final Thoughts:

During planning a loyalty program for your eCommerce business, you need to take a deep look at your customers' segmentation and insights. Learn what actions they take, the products they purchase, and the money they spend.

This way you can determine what actions are worth rewarding and how much reward each action. Utilize loyalty marketing to achieve your brand goals; growing social presence, growing order value, or referral marketing. helps you with customer segmentation and customer insights. Book a demo.