Implementing A Loyalty Program For Shoppers

One of the biggest takeaways I spotted from Intuit Mailchimp’s analysis of the 2024 holiday shopping season is that the new year is ripe with new opportunities to drive loyalty. Here’s why → 64% of orders from Mailchimp customers with connected stores came from new customers during Cyber Weekend 2024. That's a huge opportunity to grow your loyal customer base! And research we produced with Canvas8 tells us that the best kept secret to driving loyalty is actually grounded in science. Our Loyalty Wheel reveals 4 key drivers of loyalty: 1. Reward: Our brains love rewards. Create a sense of reciprocity by offering exclusive deals, personalized discounts, or early access to new products. 2. Memory: Make it easy for customers to remember (and repeat!) positive experiences with your brand. Design a frictionless customer journey, offer subscriptions for frequently purchased items, and send well-timed reminders. 3. Emotion: Foster an emotional connection that goes beyond transactional exchanges. Align your brand with causes your customers care about, share authentic stories, and build a sense of community. 4. Social Interaction: Encourage customers to share their love for your brand with friends and family. Create opportunities for user-generated content, run refer-a-friend programs, or host exclusive events. And here's how to put it all into action: 🎉 Surprise and delight: Gift your customers with unexpected rewards. And just not generic discounts. Offer exclusive experiences or partner with like-minded brands to create unique offers. 🛝 Streamline every touchpoint: Remove friction in the customer journey with automation. From browsing to purchasing to post-purchase support, make it easy and enjoyable to do business with your brand. 🎯 Prioritize personalization: Craft your messaging and build authentic connections. Use data and AI analysis to understand your customers' values and preferences and use those insights to create content that resonates. 🤗 Give VIP treatment: Make your customers feel like VIPs. Give them early access to new products, invite them to exclusive events, or feature them on your social media channels. Download Mailchimp and Canvas8’s The Science of Loyalty and The Strategic Loyalty Playbook for a deep dive into the science, complete with actionable strategies and inspiring examples: https://bit.ly/49FJayO Make 2025 the year of the loyal customer. You got this.

I analyzed 100+ loyalty programs in the last 30 days. Most brands still run loyalty like it’s 2009: Earn points, get a discount, repeat. The top 10%? They’re using loyalty to change behavior- not just reward it. If I were Head of Loyalty at a $10B+ brand today, here’s exactly what I’d do to build a program that drives LTV, repeat purchases, and real retention: 1. Stop Giving Away Loyalty - Make Them Pay for It Costco, RH, Barnes & Noble. When customers pay upfront, they buy in - literally and psychologically. Forget free points. Paid memberships = commitment, retention, higher LTV and emotional sunk cost. 2. Make Loyalty Required, Not Optional - Integrate Directly into Payments Starbucks preloads!!! When rewards are embedded in how people pay, behavior shifts faster, and for longer. This is probably the biggest opportunity in loyalty right now. 3. Forget Delayed Points - Instant Gratification is More Important Immediate dopamine beats theoretical future savings. Slow accumulation = slow engagement. Instant offers = repeat behavior. The 2nd purchase matters more than the 10th. 4. Make Loyalty Emotional, Not Transactional REI, North Face, Sephora. Customers want to belong, not just save. Identity, community, and shared values are outperforming cashbacks and discounts in driving long-term loyalty. Loyalty isn’t just a discount strategy, it’s a brand strategy. 5. Invest in Status + Experiences, not Generic Perks This isn't just theory – with companies like Rapha and Lululemon offering loyalty members exclusive product drops, community events and behind-the-scenes experiences. Lean into waitlists and exclusive product drops. Less financial. More status + psychological “being in the club.” 6. Reward Engagement, Not Just Transactions MoxieLash, Pacifica, Lucy & Yak. UGC. Reviews. Referrals. Loyalty now means participation. The modern flywheel starts before checkout - and lasts far beyond it. ~~ Bottom line? If your loyalty program is still playing a game from 15 years ago, your customers are going to find better options. Today, the best brands in 2025 aren’t just rewarding loyalty- they're engineering it. PS: We analyzed 100+ programs across QSR, retail, travel, and fintech. Next week I’ll share the Top 30 loyalty programs leading the way. Stay tuned🙏

Way too many e-commerce brands run bare-minimum loyalty programs that don't move the needle. Points. Discounts. It gets old quick. Your top 10% of customers likely drive 40-65% of your profit. But are you treating them like the VIPs they are? Or just sending them the same generic emails as everyone else? Brands that are crushing it right now are building tiered VIP ecosystems that transform transactional shoppers into high-LTV brand advocates. Speaking from 4+ years of experience, I’ve learned a few things that actually work: --> Early access drops that make top customers feel like insiders --> Exclusive product variants unavailable to regular customers --> Private Slack/Discord communities connecting your best customers --> Physical gifts that arrive unexpectedly (not just on birthdays) --> VIP-only virtual events with your founder/designers Data doesn't lie. Well-designed VIP programs consistently deliver 3-5x ROI compared to acquisition campaigns. These programs also cost dramatically less than constantly chasing new customers. Stop treating loyalty like a cost center using discounts, and start treating it like the profit driver it should be, like leveraging experiences, exclusivity, or building relationships. Your competitors are leaving millions on the table with lackluster VIP strategies. The opportunity is massive for brands willing to invest in their best customers the right way. Who's doing VIP programming exceptionally well in your category? Curious to hear some examples.

What if your product sales isn’t the end goal, but the starting point? That’s exactly how Lululemon is redefining loyalty! Lululemon’s paid Studio Membership isn’t open to everyone. It’s only available to those who own Mirror, their home workout device. What happens when you blend owned products with gated memberships? 📌 You raise the bar for brand engagement Only customers with deep product buy-in can access premium benefits such as exclusive workout content, in-store events, and 10% off. 📌 You create a loyalty loop Buy the product → Unlock perks → Use it more → Stay loyal → Buy more. 📌 You turn product use into habit The Mirror isn’t just a one-time purchase. With Studio Membership layered on top, it becomes a daily ritual, one that's tied to Lululemon’s ecosystem. 📌 You shift from discounting to value-building This isn’t about coupons. It’s about community, content, and identity, built around ownership. Here’s the insight for DTC and lifestyle brands: If your product is premium, your loyalty strategy should be too. → What if the access to your best perks was earned, and not given? → What if buying your product is the key to joining your most exclusive and engaged community? Because the future of membership and loyalty isn’t “sign up to save.” It’s “own the product, earn the tribe.” #lululemon #ecommerce #d2c #shopify

"Points for purchases" is killing your brand. That's what Phil C., CEO of Upzelo, told me during our recent Chew On This episode. And after seeing the data from 4,000+ brands, I believe him. Here's what's actually working in loyalty and retention → Phil's journey is fascinating. Before Upzelo, he built the world's largest fitness platform with a 1.45% churn rate. Now he's helping brands reimagine loyalty programs. What he taught us: While most DTC brands are still playing the points game, they're bleeding customer value and watching CAC skyrocket. Instead, here are 3 strategies to ensure your loyalty program brings value to your customers and your brand: 1. Stop Chasing Transactions Traditional approach: Points for purchases Modern approach: Reward customer success Phil shared how one UK brand connected health data to their loyalty program. Every workout became a reason to engage, not just every purchase. 2. Meet Customers in Real Life Your customers don't live inside your Shopify store. One of Phil's clients, a motorcycle gear company, built their entire program around Saturday group rides. The result? 3,500 new program members in 3 weeks. No email blasts. No ads. Just organic sharing between riders. 3. Measure Real Impact Drop these vanity metrics: - Program signups - Points earned - Reward redemptions Instead, track what drives growth: - Purchase frequency - Category adoption - Real-world sharing 4. Goal achievement At Obvi, we're already seeing the impact of this approach. When we shifted from points-based rewards to focusing on customer fitness goals and results, our retention impact transformed. The Big Revelation → The best loyalty programs don't feel like programs at all. They feel like a natural extension of why customers chose you in the first place. Want to build real loyalty in 2024? Stop trying to buy it with points.  Start earning it by helping customers succeed. Huge thanks to Phil Carr for sharing these insights from his work with over 4,000 brands. Want the full playbook? Check out our Chewonthis DTC episode where we break down: - Moving beyond transactional loyalty - Building retention through real-life connections - Measuring what actually drives growth

REI members spend 4x more annually than non-members, generating over $171 million in member rewards in 2022 alone. These aren't just loyalty points - they're cash dividends that members earn by shopping everyday at full price. In my two decades as President of KEEN and leading digital transformations at Columbia Sportswear and Deloitte Digital, I've watched countless brands (including my own) struggle with discount addiction. REI and Costco cracked the code on customer loyalty decades ago, and their model is the future of retail. Let me share how these retail giants transformed discount hunters into full-price shoppers, and why every modern brand and retailer needs to pay attention. 𝗟𝗲𝘁’𝘀 𝘀𝘁𝗮𝗿𝘁 𝘄𝗶𝘁𝗵 𝘁𝗵𝗲 𝗳𝗮𝗰𝘁𝘀… Costco Wholesale (source: Costco 2023 Annual Report): - 128 million paid members worldwide - 90% membership renewal rate globally - $4.6B in membership fees in 2023 REI (source: REI 2022 Annual Report): - 23 million co-op members - 75% of total sales come from co-op members - Members spend 4x more annually than non-members - Generated $171.2M in member rewards in 2022 While most brands and retailers were chasing points programs and discount codes, two retail giants quietly perfected the art of customer loyalty decades ago. REI and Costco's dividend-based membership programs have consistently driven full-price purchases while building incredible customer loyalty. Their secret? Understanding a fundamental truth about human behavior: customers will gladly pay full price today for a meaningful reward tomorrow. Here's the brilliance behind their model: These companies fundamentally changed how customers think about value. Instead of training shoppers to wait for discounts, they created a system where every purchase builds toward an end-of-year cash reward. This simple shift transformed their customers from discount hunters into full-price shoppers. At Angle, we're bringing this proven model directly to Shopify brands. Premium brands and retailers can now offer the same powerful incentive structure: - Cash back rewards on full-price purchases - Instant visibility into accumulated cash-back rewards - Seamless redemption across channels - Paid or free membership programs - Digital wallet passes instead of physical membership cards The future of brand building isn't endless discounting - it's giving customers as many compelling reasons to pay full price. REI and Costco figured this out decades ago. Now, Angle is making it possible for every brand and retailer to apply these same principles. Let's be brutally honest: Slapping a points program onto your existing business model isn't loyalty - it's a band-aid. True loyalty isn't bought with discounts or earned through generic platforms. It's built by fundamentally rethinking how value flows between your brand and your customer.

Fashion brands give away 15% of their profit to acquisition when they ignore retention. I learned this running eCommerce for a billion-dollar retailer. The real problem isn't your customer acquisition cost. It's your loyalty program (or lack of one). Most brands treat loyalty like an afterthought; basic points for purchases. Smart brands build retention systems that create genuine value. We helped a fashion client increase repeat purchase rate by 47% with: -Tiered rewards based on engagement, not just spending -Early access to new collections for VIP members -Personalized styling recommendations for loyal customers -Community features that build brand connection The result? Customer lifetime value increased by $127 per customer. 23% higher retention rate. 31% boost in average order value. Your loyalty program isn't just customer service. It's your most profitable growth channel.

Is a recession coming? Maybe.   But one thing’s certain: your points program won’t survive it — unless it feels like cash.   At Kalder, we work with retailers, fintechs, brands, and sports teams navigating this shift in real-time.   Here’s what we’re seeing across the board:   Margins are thinning. Budgets are tight. And your customers? They’re not spending like they used to... So what’s next?   1. Loyalty points are turning into cash equivalents. Consumers aren’t chasing “cute” rewards anymore. They’re chasing value. Utility. Relief.   Expect grocer dollars, gas points, mobility credits, and travel miles to outperform every other loyalty currency — because they stretch real budgets.   In inflationary cycles, customers don’t want to feel rewarded. They want to cover the bill.   2. Consumers will hunt harder — because they need to, not just want to. Recessions rewrite behavior. In high-trust categories like grocery, gas, mobility, and discount retail, we’re seeing a surge in offer engagement.   Why?   Because consumers are actively searching for ways to stretch their income. They’ll dig, they’ll click, they’ll link a card. Friction that used to kill the funnel? They'll push through if the upside feels real.   More time. Tighter wallets. More value sensitivity.   3. Partner rewards are becoming a core revenue line, not a side project. Sales alone aren’t enough anymore. Every brand exec is asking:   “How do we monetize our existing audience?”   Partner rewards now sit at the intersection of loyalty and retail media.   We're seeing brands: → Sell their loyalty currency to partners (airlines, grocers, mobility apps) who want access to their top customers → Monetize their best users — turning reward-loving shoppers (think TJMaxx Moms, Macy’s Stars) into a new line of revenue → Run offer marketplaces where partners pay to issue cashback and commission deals — driving their own acquisition   This isn't just retention anymore. This is a business model.   4. Subscription-based loyalty programs will be the first to get cut. If your rewards don’t tie to daily life, expect churn. Shoppers are reprioritizing essentials: groceries, gas, travel, transit.   They’ll stick with brands whose rewards feel liquid — rewards that help them pay for a meal, a ride, or a bill.   If your subscription tier offers soft perks, light discounts, or early access? You may not make it through the next quarter.   5. Rewards that feel like real money will win. Loyalty isn’t dead — it’s evolving. And the brands that win will be: → Earned daily – tied to frequent, everyday spend → Used broadly – not just “10% off next time,” but real currency → Sought after – so valuable, other brands want to issue them   Imagine this: Hobby Lobby Cash earnable at a gas station 🛍️ Macy's Stars earned on your Uber ride 🥫 ALDI USA Points stacked from your travel booking   When rewards feel unlocked, not locked-in — they become currency.

Building an email list? Sure, you could load it up with deal-chasers who are here today and gone tomorrow. (This is the trap most brands fall into) But what if, instead, you filled it with true fans who love your brand? That’s the *not so secret* hack to tripling MRR in just a couple months. Here’s how to build a list of quality subscribers who stick around and keep your revenue rolling: First, make it less enticing for “Bargain Hunters”: Constant discounts might bring in crowds, but it’s the exclusives that make people stay. Offer early access, VIP updates, bundle deals for higher AOV, or behind-the-scenes peeks to attract high-intent subscribers who aren’t just here for the next deal. Measure Engagement, Not Just Numbers: If you’re pulling in $250K+ monthly, aim for 30% of that to come from engaged subscribers. Not hitting that? Tweak your opt-in strategies to target loyal fans, not window shoppers. Shoot for above a 4% popup conversion rate with offers that speak to their real interests, or make them disclose something about themselves (like intention for shopping). Build a Journey, Not Just a "List": Zoom out... Every subscriber should feel like they’re on a path with you—whether they’re brand new or a loyal customer. Send content and steps that keep them moving forward and loving your brand more at every stage like text-only emails from the founder, helpful tips, or social proof emails. A little extra planning goes a LONG way.