Loyalty programs have been around for decades, offering customers incentives to keep coming back to a particular brand or business. But traditional loyalty programs, such as stamp cards and points systems, can feel stale and uninspiring, and may no longer attract customers today. Everybody wants something new, exciting, and exclusive.
In recent years, however, businesses have been getting more creative with their loyalty programs, offering unique and unconventional rewards that are winning over customers in new ways.
Subscription-based rewards are becoming increasingly popular, particularly in retail. These programs offer customers exclusive benefits in exchange for a monthly fee.
For example, Rent the Runway’s clothing brand offers a subscription-based service that allows customers to rent designer clothing and accessories for a flat monthly fee. This program has been hugely successful, offering customers access to high-end fashion at an affordable price point.
Gamification is the process of adding game-like elements to non-game contexts, such as loyalty programs. This approach has been successful for many businesses, making the customer rewards program more engaging and fun for customers.
For example, Starbucks offers a gamified program called Starbucks Rewards. Customers earn “stars” for each purchase they make, and these stars can be redeemed for free drinks and food items. The program also includes challenges and bonus offers to keep customers engaged and motivated.
Social Media Rewards
Social media has become a powerful marketing tool for businesses, and many are using it to offer rewards to their loyal customers.
For example, the beauty brand Glossier offers customers a discount on their next purchase if they share a photo of their Glossier products on social media. This not only encourages customers to make repeat purchases but it also helps to spread the word about the brand on social media.
Experience-based rewards offer customers unique and memorable experiences in exchange for their loyalty.
For example, the airline Virgin Atlantic offers a loyalty program called Flying Club that allows customers to earn miles that can be redeemed for flights and other rewards. However, the program also includes experience-based rewards, such as access to exclusive airport lounges, priority boarding, and even a ride on a private jet.
Charity-based rewards allow customers to give back to a good cause in exchange for their loyalty. For example, the outdoor clothing brand. Patagonia offers a loyalty program called Patagonia Action Works, which rewards customers for taking action to protect the environment.
Customers can earn points for volunteering with environmental organisations, attending climate rallies, and donating to environmental causes. These points can be redeemed for rewards such as discounts on Patagonia products and exclusive experiences.
Challenges Of Unconventional Loyalty Programs
While unconventional loyalty programs can be highly effective, they also come with their own set of challenges.
For example, subscription-based programs require significant logistics and inventory management investments, while gamification requires ongoing updates and maintenance to keep customers engaged.
Also, experience-based rewards can be costly and difficult to coordinate, and charity-based rewards require careful vetting to ensure that the chosen causes align with the brand’s values.
Best Practices For Implementing Unconventional Loyalty Programs
Businesses should follow a few best practices to implement an unconventional customer rewards program successfully. First, the customer rewards program should align with the brand’s values and be relevant to its target audience. It should also be easy to understand and use, offering customers clear benefits.
Additionally, businesses should regularly evaluate the program’s effectiveness and make adjustments as needed to ensure that it continues to meet customers’ needs and expectations.
Examples Of Businesses That Have Successfully Implemented Unconventional Loyalty Programs
Many businesses have successfully implemented unconventional loyalty programs. For example, the fitness company ClassPass offers a subscription-based service that allows customers to attend fitness classes at various studios and gyms. The program has been successful because it offers customers flexibility and variety while providing a cost-effective way to try out new fitness classes.
Another example is the beauty brand Sephora, which offers a gamified loyalty program called Beauty Insider. Customers earn points for each purchase they make, and these points can be redeemed for free products and exclusive experiences. The program has been successful because it offers customers a fun and engaging way to earn rewards while also providing valuable insights into customer behaviour and preferences.
Unconventional loyalty programs offer unique and inspiring rewards beyond traditional points and discounts, proving to be highly effective at building stronger relationships with customers. While these programs come with their own challenges, businesses that follow best practices and choose rewards that align with their brand values and target audience can create highly effective loyalty programs that keep customers coming back for more.
As consumers, we can look forward to more exciting and innovative loyalty programs in the future, and the businesses that are willing to take risks and get creative will be the ones that come out on top.