Create a Reward System for Your Shopify Customers in 4 Simple Steps

Learning how to create a reward system for Shopify customers is one of the best strategies business owners can use to cultivate loyalty. Most companies have some form of loyalty program today, as they're excellent for increasing revenue and customer retention.

With a customer reward system, business owners give their clients rewards whenever they complete a specific action, like making a purchase or referring a friend to the business.

The ability to earn rewards often encourages customers to positively alter their purchasing behavior, spending more time and money with the brand.

Components of a Reward System

The nature of your Shopify reward system can vary depending on the kind of actions you want to promote among your audience. Some of the most significant components found in most reward systems include:

• Tracking tools Tracking tools allow you to monitor who in your community is signed up for rewards.
• Incentives You'll need to define specific incentives or rewards your customers can get from participating in your loyalty programs, such as discounts or points.
• Trigger actions These are the actions your customers need to take to earn rewards. They can include referring a friend or making a purchase of a certain size.
• Membership accounts Usually, creating a reward system will mean providing your customers with membership accounts where they can track their rewards.
• Email marketing An email marketing strategy will allow you to keep customers up to date with their rewards and how they can earn more points.

Steps to Creating a Shopify Reward System

The easiest way to create a reward system on Shopify is to use one of the dedicated Shopify apps designed specifically for customer loyalty. You can find various Shopify loyalty options in the App Store, each with its own specific benefits.

The following steps outline how to use one of these tools to create your own Shopify reward system:

Step 1: Decide What Kind of Loyalty Program You Want to Run

Start by deciding what the components of your reward system are going to be. You may need a different app according to the type of program you choose. For example, you may have to use one app if you're going to reward customers for referring new clients and a different app for applying special discounts using points whenever customers make a purchase.

Step 2: Select a Loyalty App

Find a rewards program app from the Shopify app store which suits your specific needs. Many tools are available that can allow you to set up automated email campaigns, membership accounts, and tracking tools for points.

When choosing the best Shopify app, consider its customer support, customer reviews, and pricing in addition to its tools and features.

Step 3: Build Your Reward Strategy

Using your Shopify app, decide what you'll give your customers rewards for, and follow the app's instructions on how to set up automations. For instance, whenever someone purchases a certain number of products within your store, you might use the Shopify discount feature to give them money off their next purchase.

If you're using a points-based reward system, you'll need to decide how many points will be awarded for which actions and what those points are worth. For example, Smile.io automatically assigns points worth 1% of the value of a purchase to your customers when they buy something. Customers can then trade 500 points for a $5 reward.

Step 4: Share Reward Program Information With Your Audience

Finally, make sure your customers understand how your rewards program works. You might want to create an explainer page for your website or send out a Shopify welcome email to everyone who signs up for an account, showing them how to earn and use points.

How Does a Reward System Work?

The purpose of a Shopify Reward system is primarily to convince your customers to spend more money with your business and help your store grow.

The exact functionality of your reward system will depend on the kind of strategy you use. The main types of reward programs are:

• Points-based loyalty programs A point-based reward program assigns points to customers based on the actions they take, such as recommending a friend, sharing something on social media, or making a purchase. Customers can then exchange points for free products, gifts, and discounts.
• Tiered loyalty programs Tiered loyalty programs are similar to point-based programs, but customers receive different rewards according to their tier. Usually, customers will move to higher tiers when they spend more with your company and get more attractive rewards.
• Paid loyalty program With a paid rewards program, your customers actually pay a monthly fee to get access to specific perks. For instance, you might give your paying customers free next-day delivery or free shipping on all their purchases.

Benefits of Customer Reward Systems

The primary benefit of a reward system on Shopify is you'll be able to increase engagement with your audience and potentially boost sales.

With a reward system, you can:

• Increase retention and customer lifetime value by giving customers a reason to continue shopping with you
• Reduce marketing costs by asking your customers to refer new customers to your brand
• Minimize slow seasons by encouraging customers to buy regularly to earn rewards
• Boost profits and increase average order value with the promise of rewards
• Create mailing lists of people who sign up for your program for nurturing
• Improve your brand reputation by delivering extra value to your customers

When used correctly, a reward system can be an excellent way to help your business grow.