What You Need To Know About “Spending-Based” Loyalty Programs

To understand why so many companies are going spend-based, just look into why retailers have rewards programs in the first place. Repeat customers are a valuable asset to any business, and by offering discounts or free goods and services, customers are encouraged to remain faithful.

But not all customers, or transactions are created equal.

Some customers visit more frequently and/or spend a lot more money than others–  one customer purchase maybe for $5, another for $500.  Many loyalty programs are “transaction-based” and do not adequately increment their rewards based on the spending patterns of the higher value customers (that longstanding “80-20” rule of thumb).

The solution is a spending based loyalty program. With spending-based loyalty programs, retailers are rewarding their higher-spending customers. Customers who spend more, earn more.

Customer Loyalty Accelerator (CLA) is a groundbreaking loyalty program,
using the power of spend-based store credits to reward
return customer visits and higher spending.  
CLA’s innovative, “spend-based” approach rewards customers that spend more with targeted incentives for return visits and even more spending.

Starbucks Makes the Move to “Spend-Based” Loyalty

In February 2016, the world’s most popular coffee chain announced that it was changing its transaction-based rewards program to a spend-based one. Previously, each transaction earned one star, regardless of the beverage size or price.   Under the new spend-based program, customers earn two stars for every dollar spent.

The Best Loyalty Programs Turn Customer Activity Data into Powerful Personalization

More and more retailers are catching onto the fact that loyalty shouldn’t just be a program—it’s a relationship. To make your loyalty experience into a vehicle for true relationship building (and the positive brand feel that results), it should meet four customer needs:

  • Make them feel valued
  • Enable them to take control
  • Reward them for loyalty
  • Give them loyalty rewards based on the value of their spending with you

So how can retailers keep their customer loyalty program from being less like a commodity and more like a relationship?

Make sure the program is capturing as much customer data as possible, and as efficiently as possible, to serve up a personalized loyalty and rewards experience across customer touchpoints and interactions.

Customer Loyalty Accelerator is available for download
on the Shopify App Store at  https://apps.shopify.com/encorecla

Also on the Clover App Market at

Source:  Adapted from NCR.com, Danielle Brown author