Customer rewards

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.

1. 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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.
8. 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.
9. 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.
10. Donation programs: Appealing to customers with likeminded values can align your brand with those who prefer to spend with likeminded companies.

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