As you work through program configuration, try to imagine yourself as your customers and consider their experience. The following guiding principles help formulate the ideal customer journey by rewarding customers at the right time and with the right rewards.
1. # of purchases to the first reward
You should ensure that the customer needs to make a purchase at least once, but no more than three times. Make the rewards attainable by considering your customers' purchase behaviour.
Example: take your average order value (AOV) and multiply it by 5 points for every $1 spent rule. Is the customer now eligible for the minimum reward?
2. Redeeming is not possible without a customer purchase
You should avoid a program that allows you to earn enough points without placing an order to redeem a reward. Customer loyalty will be enhanced as they do not have to create a new account every time they place an order to receive their discount.
Example: Sign-up points and social action rewards should be below the minimum points needed to qualify for the minimum available reward.
3. Amount of points given back to a customer
In terms of points value, we recommend giving back between 3% and 10%
Example: Customers who earn 5 points for every $1 spent, and purchase $100 worth of goods, will earn 500 points ($100 x 5) equal to $5 in points value. They will get back 5% of the value of their purchases with this reward.
4. Reward percentage for advocates and friends
Between 10%-20% of the store average order value, rounded to the nearest $5.
Always try to consider the customer journey as you create your rewards program. In addition to the above principles, below are a few questions to keep in mind during setup:
Do I receive points for creating a store account?
How many points will I earn for an average order placed?
How soon can I spend my points on a reward? After 1 purchase, or 2?