Does your ecommerce site need rewards?

Rewards programs have continually been used to not just entice customers but to re-market to them to strengthen their brand loyalty. However, with the rise of mobile usage, customer expectations are changing. Are customer needs being met by rewards programs, or are they headed for extinction?

A best-in-class rewards program thriving in today’s climate is the My Starbucks Rewards program and app. Though it is not solely devoted to ecommerce, mobile transactions still make up a large portion of its sales and is growing each day. The Starbucks mobile app goes above and beyond traditional “card only” loyalty programs and is raking in over 6 million transactions a week on its own – a formidable testament to the power of loyalty!

Starbucks has integrated customer rewards in a true omni-channel fashion from kiosks to grocery stores to the exclusivity of the “Gold Card” (a reward in itself, once you accumulate enough points). The Gold Card is just as much a way for top customers to show off their dedication to the brand as it is a status symbol.

While not every site has the budget and reach of Starbucks, there are plenty of ways to get in front of your customers; think email marketing, customer service help desk, live chats and remarketing. In addition, the best loyalty programs reward customers for their purchases over the long term- as it is much less expensive to convert an existing customer as it is to acquire a new one. Retention efforts should focus on emotional value, with an emphasis on the time it takes to earn rewards, the program simplicity and the alignment with consumers’ values and interests.

To put this into practice in your own ecommerce business you must tailor the loyalty program based on where the consumer is in their journey with your company. By reviewing customer data and purchases, you can identify your best customers, or top spenders and reward them accordingly. On the other side of the spectrum, you should have a separate series of messages and promotions tailored to members who have opted into your program but not purchased, are subscribed to your email mailing list but not a loyalty member, or if they make a 2^nd or 3^rd purchase. While you know your VIPs will purchase, and you thank them for it, it is an entirely different process to get less frequent buyers to complete the path to purchase.

Another way to spice up a loyalty program is to invest in strategic partnerships. From earning air miles on credit cards to free Starbucks when using Lyft, large-scale points-building loyalty programs are not just for big businesses. Not only can they entice customers to spend more and shop more frequently at member stores, but they also have a significant impact on the revenues of the original (referring) source. Partnerships and co-branded products help solve the common customer complaint that they weren’t earning rewards fast enough – while still remaining economically feasible.

Though traditional methods of loyalty programs (think mailing in box tops) have wavered, the impact of the rewards program remains steads & growing! Customers are deferring to social networks, personalized messages, partner programs and mobile apps as a way to get more of their favorite products from the brands they love.

As an ecommerce company, when you create a loyalty program that is encouraging, enticing and budget-friendly for customers, they’ll reward you many times over with business, referrals and most of all, loyalty!