small business customer loyalty
The Perfect Equation for Your Loyalty Program's Rewards Based on Real Data
Uncovering insights that help our Merchant partners drive more customer activity at their businesses is one of my favorite things to do as a marketer. Our latest undertaking was to look at the reward distribution across our network to understand how the rewards a Merchant offers impacts their customer activity.
By looking at our Merchant and Member data, we can begin to answer questions like:
- Are customers who redeem rewards more loyal?
- What is the ideal number of rewards to offer customers?
- What is the right mix of monetary and experiential rewards?
- Which rewards are redeemed the most often and at what point value?
- Do high-value, aspirational rewards add value to a rewards program?
To start, our Data & Analytics team analyzed a sample of rewards being offered across our Merchant network, from monetary to experiential, at varying point levels and across different verticals. Then, they looked at how often those rewards were being redeemed by our Members.
The result? Some great insights for creating the perfect equation for a great rewards suite.
Here are a few of our key findings that you can apply to your suite of rewards:
Reward redemptions are critical to retain customers.
Over 90% of Belly Members who redeem a reward return to that business within a month. 90%! This compelling statistic is part of the reason we recently implemented Goal Gradient, a Belly feature that awards Triple Points the first time a Belly Member checks in at a business. This change was made because moving customers toward a reward quickly keeps them engaged and loyal to your business. Refer to the above 90% stat if you’re skeptical of this reality.
Key takeaway 1: Include rewards your customers actually want in order to build customer loyalty. Provide a mix of monetary (Free Ice Cream!) and experiential (Name Your Flavor!) to appeal to a wider audience.
Key takeaway 2: Make sure you have Goal Gradient turned on if you’re a Belly Merchant.
Customers redeem the 10th visit reward most often
On the Belly network, this is typically the 50 point reward (assuming 5 points for each visit).
Key takeaway: After the 10th visit, your customer has proved loyal to your business, so reward them appropriately! Whether it’s a free cup of coffee, a free deli sandwich, a complimentary blow out or 25% off their order, make sure this reward is substantial so that your customers will continue to work for it again and again.
High-value rewards provide aspirational value
When looking at our data, reward redemptions start to taper off around the 18th visit, however, merchants tend to adopt high-value rewards as part of their rewards suite often.
Key takeaway: Don’t overlook providing aspirational targets for your customers. While these high-value rewards don’t necessarily get redeemed often, they provide value by existing as a goal.
Below, you’ll see a sampling of data showing how rewards are distributed across our network; by rewards offered by Merchants and rewards redeemed by Members:
Reward Portfolio Guidelines: By Vertical
Another notable (yet not surprising) find was that not all verticals are created equal. The ideal number of rewards and the value of those rewards varies by vertical. We’ve created the following reward suite guidelines based on successful Belly businesses with highly redeemed rewards across four verticals: Food, Shopping, Services and Beauty.
Reward Portfolio Guidelines: By Reward Type & Point Value
It’s also important to build a rewards suite that caters to all of your customers. Having the right mix of monetary and experiential rewards keeps 100% of your audience engaged with your Belly loyalty program. The following chart looks at the engagement for monetary and experiential rewards at varying point levels across the Belly network.
Conclusion: What is the perfect equation for a loyalty program rewards suite?
We looked at a lot of variables that make up a successful rewards suite. When you get started with Belly, it’s important to get your rewards suite right, so that you get off to the right start. Here are some steps to follow:
- Offer the ideal number of rewards recommended for your vertical, as illustrated in the “Reward Portfolio by Vertical” chart.
- Offer a mix of monetary and experiential rewards to appeal to all of your customers, as illustrated in the “Reward Portfolio by Reward Type” chart.
- Make your 50 point (10th visit) reward killer, as it will likely be your most redeemed reward and will incentivize your customers to continue coming back again and again.
- Take advantage of our Goal Gradient feature to get new Members off to a great start with your loyalty program.
Still feeling lost? It’s ok! That’s what our Merchant Success Managers are here for. All Belly Merchants have access to rewards guidance from our expert account managers. Just give us a shout!