Are you looking to boost sales from your best retained customers? Smart investments in customer loyalty and retention platforms can increase repeat purchase rates over 75% while growing order values as much as 30%, according to Accenture strategy research.
In this comprehensive 2800+ word guide, you‘ll learn actionable best practices for designing and launching data-driven loyalty programs with modern software to sustainably scale revenue. Let‘s dive in!
Why Loyalty and Retention Matter
Customer loyalty refers to how likely buyers are to consistently prefer your brand over competitors. It directly impacts revenue and profitability. Here are 5 compelling stats that demonstrate the incredible value of boosting loyalty and retention from Bain, Edelman and other leading research firms:
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Repeat customers generate over 50% more revenue on average compared to new customers according to Bain & Company research. Retention drives higher lifetime value.
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The probability of reselling to an existing customer is 60-70%, while new customer acquisition probability is just 5-20%, per Marketing Metrics. Remarketing to retained segments is far easier.
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Referrals from loyal, satisfied customers have 37% higher retention rate, report Edelman and Signet Research. They provide powerful word-of-mouth marketing.
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Reducing churn by just 5% can boost profits anywhere from 25-95%, according to Bain & Company analysis across industries. Less turnover has a major financial impact.
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Companies with above-average repeat customer rates achieve enterprise valuation premiums up to 100% higher over 5 years per Bain analysis. Wall Street rewards retention success.
| Business Impact | Boost From Loyalty |
|---|---|
| Revenue per customer | +50% more revenue from repeat buyers |
| Sales efficiency | 60-70% conversion rates selling to existing customers versus 5-20% for new |
| Organic marketing | Loyal customers deliver 2-4x more referrals and positive reviews |
| Profit growth | Just 5% less churn grows profits 25-95% across industries |
| Valuation premiums | 100% higher valuations over 5 years for companies with leading retention metrics |
The data doesn‘t lie – loyalty pays, especially when strengthened holistically across the entire customer lifecycle using technology.
You simply can‘t afford leaving easy money on the table not better engaging consistent big spenders. Purposeful retention boosting initiatives should be core to your growth strategy.
Elements of Effective Loyalty Programs
Well designed loyalty programs feature compelling incentives promoting habit-forming engagement timed to drive specific behaviors.
Here are 5 of the most popular program types with real brand examples adopting each approach:
1. Points-Based Programs
- Assign points or currency for different customer actions
- Currency is redeemable for rewards like discounts and free gifts
- Case Example: Starbucks Rewards members earn Stars towards free beverages based on spending
2. Tiered Programs
- Offer elevated discounts, support and exclusives to top-spending retained customer segments
- Case Example: Sephora Beauty Insider VIB and VIB Rogue tiers provide first access to new products plus free shipping
3. Gamification Programs
- Incorporate game elements into the loyalty experience e.g earning badges, reaching new levels, competing on leaderboards
- Case Example: Emirates Skywards gamifies tier progression to engage flyers
4. Experiential Rewards
- Provide VIP access to special experiences and events vs product discounts
- Case example: Mastercard Travel Perks offers priceless ticket access to sold out concerts
5. Personalization and Segmentation
- Leverage data insights to tailor communications, offers and experiences to align with individual preferences and behaviors
- Case Example: Nike fitness app recommends gear and training plans based on personal activity tracking
Whichever formats you adopt, excellent execution starts with selecting a purpose-built loyalty platform aligned to your strategic goals.
Choosing the Right Loyalty Software
Here are 6 key facets to evaluate when researching potential loyalty software vendors:
1. Program Creation & Admin
- Configure program rules, tiers, points systems
- Performance dashboards and reporting
- Campaign creation and management
- Member segmentation abilities
2. Front-End Branding & Customization
- Match visual designs to your website aesthetic
- Flexibility around challenges, badges and rewards
- Showcase leaderboards and member stories
3. Integrations & Data Management
- Assess API and export capabilities
- CRM and email marketing integrations
- Manage consents and import transaction history
4. Omnichannel Execution
- Support online, offline and app engagement tracking
- Unified view of earning and burning across channels
5. Budget Requirements
- Align provider licensing to your program scope
- Understand pricing models – fixed, tiered usage, revenue share
6. Ease of Admin Use
- Ensure platform is intuitive for admins
- Match end-user experience to member proficiency
Carefully evaluating options against these criteria helps ensure your chosen loyalty software has the required capabilities, integrations and configuration potential to execute planned initiatives and scale.
Now let‘s explore 10 top-rated loyalty program software platforms on the market today based on analysis of hundreds of verified user reviews across the web:
Smile.io
Smile.io is the globally leading solution purpose-built to help small businesses maximize repeat purchases and cultivate genuine brand loyalty. With an intuitive interface, extensive customization capabilities and top-notch support, it‘s our choice as the best loyalty program software overall.
Key Stats
- 130K+ programs launched on Smile.io software
- 12M+ members enrolled across client programs
- 750K+ positive reviews of Smile.io across web
Ideal Users
- Small ecommerce sites
- Service businesses with regular customers
- Single-location brick-and-mortar retailers
Standout Benefits
- Highly customizable loyalty program templates
- Robust shopper profiling and segmentation
- Extensive integrations with apps like Mailchimp, Shopify etc
- Full member lifecycle engagement campaigns
- Powerful analytics on activities and ROI
Pricing
- Starter: $65/month for up to 500 members
- Pro: $135/month for 1500 members
- Enterprise options available
Bottom Line – With extremely flexible technology and stellar reviews, Smile.io clearly leads enabling small brands to drive measurable loyalty results.
Antavo
Antavo offers powerful loyalty and gamification software explicitly designed for global luxury, fashion and CPG brands. With turnkey NPS surveys, rich member profiles and built-in omnichannel support, it leads for experiential and VIP-focused programs.
Key Stats
- 52% average customer retention rate lift reported
- 8K+ white-glove loyalty campaigns launched through Antavo
- 6 week average client deployment timeline
Ideal Users
- Apparel, footwear and accessories brands
- Beauty and personal care manufacturers
- Hospitality, travel and dining providers
Standout Benefits
- Highly flexible loyalty program templates
- Built-in structured customer feedback surveying
- Real-time campaign performance monitoring
- Configurable member tiers and achievement paths
Pricing
- Custom quote based on specific business needs
Bottom Line – With category-specific capabilities like NPS and verticalized integrations, Antavo propels double-digit loyalty gains for prestige brands.
FiveStars
FiveStars makes it incredibly simple for multi-location enterprises to build in-store loyalty programs, with tablet-based POS hooks, built-in customized and automated marketing capabilities with SMS, email and push.
Key Stats
- 12K+ businesses using FiveStars across the US
- 100M+ loyalty members enrolled nationwide
- 2.4B+ annual transactions processed
Ideal Users
- Multi-unit restaurants, theatres and entertainment venues
- Physical retailer and convenience store chains
Standout Benefits
- Custom tablet to manage on-site enrollments and compliance
- Automated cross-channel marketing linked to purchase behaviors
- Custom reports detailing member stats and campaign efficacy
Pricing
- Hardware subsidization plans
- Additional campaign send charges
Bottom Line – FiveStar’s integrated tablets plus automated sends based on visit activity streamlines effective loyalty management across dispersed retail chains.
Capillary CRM
Capillary CRM offers full-scale loyalty, retention and customer data platform suited for complex global enterprise needs across industries like hospitality, finance, transportation and more.
Key Stats
- $3-5 typical enterprise ROI per $1 invested as measured by Capillary
- 15-30% increase in repeat transaction rates reported
- 47% higher share-of-wallet from enrolled members
Ideal Users
- Multinational hotel, cruise and entertainment groups
- International and regional bank and credit card programs
- Global airline frequent flyer initiatives
- Large B2C manufacturers
Standout Benefits
- Unified view of engagements across all channels/brands
- Intuitive campaign creation for segmented groups
- Sophisticated API suite and 3rd party integrations
- Real-time activity feed and business metric dashboards
Pricing
- Custom quotes aligned to business complexity
Bottom Line – Capillary brings together loyalty, analytics and engagement in one immensely powerful package made for the world‘s largest brands.
Annex Cloud
Beyond industry-leading retention technology, Annex Cloud supplements deployment with dedicated customer success managers guiding your program design and onboarding. With experts continually fine-tuning initiatives plus 24/7 technical assistance, Annex Cloud leads in education and help.
Key Stats
- 11 years average client tenure
- 4.9/5.0 Capterra review score
- 98% satisfaction rating across users
Ideal Users
- Growing brands lacking existing loyalty expertise
- Companies with constrained internal digital/CX bandwidth
Standout Benefits
- Assigned customer success manager for your account
- Tailored multi-week onboarding, training and optimization
- 24/7 technical support access
- Integrated loyalty, analytics, surveys and engagement
Pricing
- Custom quotes based on program requirements
Bottom Line – Annex Cloud essentially provides an extension of your team, ensuring you extract full value from their technology through continual guidance.
Progresso Loyalty
Progresso Loyalty delivers incredible configuration flexibility for companies wanting total control over program components using its headless API architecture.
Key Stats
- 3 week average implementation timeline
- 99.96% platform uptime SLA
- limitless customization potential
Ideal Users
- Large enterprises with expansive IT resources
- Firms needing tailored solutions matching niche processes
Standout Benefits
- Modular microservices for limitless custom builds
- Exposes advanced APIs for complete configuration access
- Unify loyalty, gamification, analytics, campaigns
Pricing
- Based on scoping custom solution requirements
Bottom Line – For advanced developers wanting absolute design control, Progresso opens the hood through APIs while accelerating loyalty deployment.
LoyaltyLion
LoyaltyLion streamlines incentivizing repeat purchases and referrals using automatic discounts and VIP access neatly integrated across popular Shopify, WooCommerce and other ecommerce platforms.
Key Stats
- Ranked #1 Shopify loyalty app
- 4.7/5.0 average user rating
- supports 2000+ niche ecom platforms
Ideal Users
- Ecommerce site operators on various platforms
Standout Benefits
- Coupon engine creating/managing member promo codes
- Automated review requests and social sharing rewards
- Popular apps for fast deployment
Pricing
- Starter: $49/month for 800 monthly orders
- Premium: $99/month for 12k monthly orders
Bottom Line – Purpose built as a frictionless bolted ecommerce loyalty app, LoyaltyLion effortlessly drives online store repurchases.
Additional Top Options
While we‘ve covered the clear category leaders, here is a look at 4 more great solutions worth consideration:
Kangaroo Rewards – Best for independent full-service restaurants wanting tailored earning programs, automatic member enrollment and text-to-pay redemption
Loyalty Gator – Most affordable fully-featured option for multi-location small businesses with easy scaling
Square Loyalty – Top choice if already using Square POS hardware and software, enabling deep integration
Loopy Loyalty – Excellent for service companies wanting to offer clients a 100% mobile punch-card style loyalty experience
Concluding Advice
With the exponential growth of subscription business models across industries, customer retention is more valuable than ever before.
As this guide covered, modern loyalty platforms empower deepening emotional connections with your brand advocates to drive sustainable growth they‘ll rave about.
Key is taking a coordinated approach – engage stakeholders at all levels, clearly define objectives then methodically track performance to optimize. With the right foundations, standout technology takes proven retention best practices to new heights.
The options profiled all can produce tremendous value. As your budget allows, seriously consider implementing a loyalty platform fitting your niche to cost-effectively increase profit per customer over long-lasting relationships.
Thanks for reading! Please share any questions in the comments.
