Customer rewards
There are thousands of ways to reward and thank your customers. Find resources here for where to start, what to offer, and ways to leverage perks to build loyalty.
Customer rewards aren't always point based
After all, only 37% of consumers say that points can influence their loyalty (KPMG). Only 42% of consumers make purchases that earn rewards or benefits at least several times a week, reflecting a sentiment that 69% of Millennials share: loyalty programs are difficult to join and earn rewards. In our guides about customer rewards, we dive into the perks landscape and explore ways to reward customers that go beyond traditional point-based programs.
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Increase customer retention with perks
How can perks reward your customers for sticking around? Let's explore.
How a customer perks program affects LTV
How do you increase the lifetime value of your customers? Offer a reason for them to come back.
How to use perks to increase conversion rates
Incentives work. Get potential customers over the line with an offer they can't resist.
There's countless ways to design your rewards program
Here are the types we know about. Overall, most programs will utilize a combination of points, perks, cash back, or rebates as the rewards currency. Choose which levers make the most sense for your business depends a lot on what the competitors in your industry are doing, and how you can serve customers better and faster with your program.
- Points programs: Customers earn points based on dollars spent and frequency of purchases which are redeemable for free products, gift cards, or other rewards. Commonly used in aviation, hospitality, retail, and financial industries.
- Cash back programs: Customers earn a percentage of cash back on spending which comes in the form of statement credit, check, or gift card from the company. Often used in credit cards, online services, and consumer banking industries.
- Loyalty programs: Brands provide exclusive perks, privileged services, and special sales to their most loyal and high-value customers to maintain engagement. Used in hotel, specialty retail, and grocery store industries.
- Tiered programs: Companies provide increasing benefits and higher redemption rates as customers reach new tiers through higher spending over time to incentivize loyalty. Airlines, luxury retailers, and specialty membership organizations utilize these types of programs.
- Referral programs: Businesses reward existing customers for referring their friends and family to open new accounts; benefits come in cash, points, or gifts for both referrer and referee. Technology companies, financial institutions, and healthcare networks leverage these programs.
- VIP programs: Providing privileged access to high-revenue customers with exclusive events, preview sales opportunities, and sneak peeks in advance of other customers. Premium credit card companies, luxury automotive brands, and elite professional services firms provide VIP rewards.
- Rebate programs: Brands provide partial refunds or discounts to customers after initial purchases as purchase incentives. Used often by big box retailers, insurance providers, and travel booking sites.
- Prize draws: Companies automatically enter members into contests to win big ticket merchandise prizes like vacations, transportation, and electronics to build engagement. Used by consumer product brands, entertainment companies, and professional sports teams.
- Discount programs: Brands offer loyal members exclusive sale pricing or members-only discounts to maintain loyalty. Offered by warehouse retailers, specialty dining and fitness concepts, and subscription box startups.
- Donation programs: Appealing to customers with likeminded values can align your brand with those who prefer to spend with likeminded companies.