Loyalty programs are staples of airlines, hotels, and grocery stores. So it’s tempting to think they’re the key to loyalty for online stores too. But simply porting over a points-based program from the offline world often fails to make customers truly loyal.
In this article, I’ll explain why loyalty programs can fall short in ecommerce and provide tips to earn real loyalty online.
Flawed Assumptions Underlie Ecommerce Loyalty Programs
Don’t get me wrong, properly executed loyalty programs can have incredible results in online retail. The problem I’ve seen is some brands treat loyalty programs as a means to an end, when it should act as a tool to enhance the bond between your brand and customers.
Many loyalty programs can take a mechanistic view of customers: collect enough points and you’ll get a reward that compels you to keep shopping. In an abstract way, this can make customers almost like robots – accumulate rewards and loyalty follows.
But real people aren’t so simple. Here are some flawed assumptions baked into typical ecommerce loyalty programs:
- Customers only care about accumulating points and rewards
- Offering rewards for spending will increase customer lifetime value
- Customers see value in reaching elite tiers like Gold or Platinum
- Loyalty programs lock customers in against competitors
While some of these may be true for specific customers, these assumptions lead brands to create programs that incentivize purchases but fail to make an emotional connection.
Points and free shipping are table stakes now – not differentiation.
True loyalty comes from shared values and human relationships, which no amount of points can manufacture.
Signs Your Ecommerce Loyalty Program Isn’t Working
How can you tell if your loyalty program is failing to create real loyalty? Here are some red flags:
- Rewards go unused
- Customers only engage to earn points, not because they like your brand
- Loyalty members aren’t more valuable than non-members
- You’re losing loyal customers who engage but rarely buy
- There’s no community among members
If your program exhibits these issues, it’s time for an overhaul. Simply tweaking multipliers or elite tiers won’t cut it. You need a human-focused approach.
Fostering Real Loyalty Among Ecommerce Customers
True ecommerce loyalty is emotional, not contractual. It’s built through shared values, great experiences, and human connections.
Here are ways to cultivate real loyalty and community with online customers:
Show you know them individually
- Offer personalized recommendations based on purchase history and interests. This shows customers you recognize them.
- Highlight loyalty milestones like custom coupons on 5th, 10th, 20th purchase anniversaries. Make it about celebrating the relationship, not just another discount.
- Surprise and delight randomly with small gifts like free expedited shipping or gift cards. The unexpected gesture delights more than expected rewards.
Make values and purpose transparency
- Share your origin story prominently on your site and packaging. This builds an emotional bond with customers.
- Explain what your brand stands for through a mission statement, manifesto, or list of principles. Give customers something to connect with.
- Highlight sustainability and social impact efforts. Today’s consumers care about buying from ethical brands.
Facilitate customer-to-customer connections
- Moderate a brand community forum for customers to interact, get advice, share photos, and more.
- Spotlight user generated content like reviews, videos, and photos from real customers. This fosters a sense of community.
- Host live events online like workshops, classes or meetups customers can join and engage with each other.
Empower employees to build relationships
- Allow leniency for employees to resolve issues as they see fit, not just rigid policies. This builds trust.
- Train staff on emotional intelligence so they can relate to customers personally and compassionately.
- Incentivize relationship-building skills like active listening, creative problem solving, and empathy.
Continuously gather then act on feedback
- Send Net Promotor Score (NPS) surveys after purchases and interactions to measure satisfaction. Combine these scores with open-ended feedback.
- Proactively reach out to both new and long-time customers to understand pain points and desires. Don’t wait for them to complain.
- Implement changes based directly on feedback. Close the loop to show customers you listen.
Key Takeaways
- Loyalty programs often fail to make ecommerce customers truly loyal due to flawed assumptions.
- True loyalty comes from shared values, great experiences, and human connections – not points and rewards.
- Build loyalty by personalizing, facilitating community, empowering staff, and gathering feedback.
- Shift from a transactional to emotional relationship with customers. This earns enduring loyalty that withstands market swings and new competitors.
Don’t fall into the trap of loyalty program metrics without meaning. Foster devoted brand advocates by treating customers like valued partners, not just accounts to optimize. This builds an unbreakable emotional bond that point balances can never replicate.