The benefits of implementing loyalty points for your online shop

Loyalty is essential to all businesses but even more so for ecommerce businesses. Ecommerce shops are in a constant battle for customers, with price wars, saturated markets and competitors just a click away, so giving customers an incentive to return to your website is key. With the right loyalty system, you can leverage the benefits of loyalty points to help keep customers returning, boost sales, increase average order value and strengthen brand and customer loyalty.

Let’s explore exactly what the benefits of loyalty points are:

Customer Retention & Repeat Purchases       

When customers collect loyalty points as they shop, it can create long-term habits. The habit loop refers to cue, routine and reward – by ‘rewarding’ their shopping with loyalty points you can cement customer habits of shopping with your brand. With formed habits and loyalty points accumulating, customers are much more likely to make repeat purchases in order to collect and maximise the benefits of their reward points. 

This means customers will be more likely to engage with your brand, exploring other products and services, deepening their relationship with you, increasing their lifetime value via more frequent and diversified purchases helping to boost your customer retention.

Boosting orders

When there is a perceived reward customers are more inclined to shop, and purchases that are being considered are more likely to be committed to as they feel like there is additional gain for them. Customers are also more inclined to do all their shopping with you, for example, if they were looking to buy shoes from you but also need a jumper, they may choose you over anywhere else to reap the benefits of loyalty points. This helps to increase the volume of sales you see and boost your revenue. 

Similarly, limited-time bonus points create an additional perceived reward value as well as a sense of urgency which drives customers to make purchases they may contemplate, hence increasing the number of orders you receive.

Boost average order value

With a spend-based loyalty point system such as EKM’s not only are customers incentivised to shop with you but to spend more when they do so. By rewarding customers for every pound they spend, you are encouraging them to explore more of your product range, choose a premium option, or even just to buy greater quantities than usual. As a customer looks to spend beyond their initial intent they naturally have to explore and engage with more of your brand, which helps reinforce trust and build a stronger sense of brand loyalty with every interaction.

Competitive Edge in Saturated Markets

Loyalty programs provide a powerful way for your ecommerce brand to differentiate from competitors by offering unique rewards. When you operate in a market that has so many direct competitors, a loyalty point system gives you the competitive edge that you need to set you apart and provide your customers with a unique experience that keeps them coming back. By offering more than just discounts—like personal rewards or tiered benefits—brands build stronger connections with customers and keep them coming back instead of shopping elsewhere.

Conclusion

A loyalty point system isn’t just a way to reward customers—it’s a chance to build strong relationships that can help your business grow. By building strong loyal relationships with your existing customers not only do you create opportunities for greater revenue and business growth, but you do so in a cost-effective way. With a loyal customer base, you can benefit from word-of-mouth and the trust your brand builds over time helping to grow your business passively.

With EKM implementing loyalty points is simple. Want to learn about how to implement loyalty points for your online store with us? 

Register for our webinar here.