App Maker Appy Pie

What does it take to Build an Alluring Loyalty Program with MOBILE APPS?

Abhinav Girdhar
By Abhinav Girdhar | Last Updated on February 26th, 2024 7:35 am

App Builder Appy Pie, March 15, 2018: This is a world where the users have a multitude of options in front of them in terms of the number of brands that they can choose from. And almost all of them are trying to woo the customers with some kind of a reward of loyalty. Are they merely using a loyalty program or reward as a means to an end where they get your email id? Or is it a well-placed, aptly designed, and properly implemented loyalty program like Starbucks did and created a success story by gaining 13.3 million users. The attention span of an average user is way lower than it had been in the past, but the expectations have gone way up! This means the chances of the customers coming back to you for a second sale are not so hot! If you are looking for long-term success, then you would have to figure ways out to take advantage of the possibilities that technology offers to build strong, sustainable relationships with the customer. But getting that right is an uphill task. According to a recent survey, if there is a 5% increase in customer retention you can expect at least a 25% boost in your profit. In fact, 60% of loyal customers say that they will buy more frequently from their preferred companies. So, how do you establish this loyalty among your customers? Loyalty programs are a great way to establish a strong connection between your users and the products that you’re selling. Ideally loyalty from the users or customers is earned by the brands by making their lives easier, enhancing the quality of their lives, adding an aspect of convenience and enjoyment in their everyday living. However, a great way to add to the already amazing app experience, you may design a loyalty program and offer rewards to the users and encourage them to become a part of your brand story. There was a time when every departmental store, shopping mall, and boutique offered their very own loyalty cards with exciting discounts, points, and rewards. This, however meant that you would have to either carry the card on your person at all times or memorize all your card details. Times have changed now and there is an app for everything. If you have a flourishing loyalty program or are planning to launch one, trust me, it is smarter to create a loyalty card app.

How do loyalty card apps work?

There are multiple ways in which businesses manage their loyalty card apps. Some would store a digital image of each card in a database to be retrieved and scanned by the cashier at the time of purchase. While still others would scan the QR code in the customers’ loyalty card apps. If you can think of a better way to make this work, it is a brilliant idea to create a loyalty card app and simplify the entire process. This also means that you would get more of your loyal customers to download your loyalty app and start using it.

3 Key Ingredients for a smart, mobile-first loyalty program

You are a candidate for a mobile first loyalty program if it is important for you to build a base of customers who would return to you. However, it is important that you understand that a loyalty program is far more complex and sophisticated than the Buy 3 Get 1 Free model. Following are the three key ingredients for a mobile-first loyalty program that is smart and successful.

#1 Getting Creative with Rewards

Rewards today are not as simple as Buy 3 Get 1 Free (though they work fabulously too!). It is important that you get creative when you decide the rewards you’d be offering your customers. The rewards should be valuable, timely, and relevant for the customers.

#2 Tracking the Progress

The process of tacking the progress begins with developing an understanding about where the users are in their journey of interaction with the app. Since no two people would interact with the app in an identical manner, so it’s not easy to map a template through the user funnel as it unfolds. You may use a lifecycle engagement platform to collect nuanced, actionable data about the way each member of the audience is engaging with your app or any other element of your brand experience. These actionable insights can be then utilized to optimize your mobile-first loyalty program and the messaging support system it employs. When you understand the behavior and interactions of the members of your loyalty program and the campaigns that prove to be more effective than the others at driving new sign ups, you would automatically develop deeper, stronger, and long-term customer relationships.

#3 A Joyful Loyalty-Program 

For a loyalty program to have some measure of success attached to it, it must have some sort of a personality. When you have researched your target users in depth, you know their pain points as well as their aspirations. Once you have access to the pain points and aspirations of your target user, you can create an amazing loyalty program that can prove to be a big opportunity for cross-channel marketing, gamification, and even for the expansion of your brand voice. Make sure that you keep your brand story in mind while developing or designing a loyalty program. Reward programs of course make a considerable impact on the bottom line of the company, however, more importantly a well-designed loyalty program goes a long way in shaping up an image for the brand in the eyes of the customer. As per recent surveys, it has been established that loyalty programs are more effective in building up brand satisfaction as compared to pricing or value perception. Today the loyalty programs have stepped out of the rut of merely offering rewards and saving money. You can use loyalty programs to make the shopping experience interesting and engaging through gamification techniques by inviting the members of the program to various contests and incentivizing them to share your app or content within your app.

The Two-Way Advantage of Loyalty Apps

Loyalty apps are not just for your customers to reap big rewards and discounts. These apps can prove to be a highly economical and effective way to collect information about your customers, particularly their buying behavior. You can also collect information about the progress of a customer in a certain reward program and even keep an eye on the performance of your employees. The information you gather through these apps can help you run more targeted campaigns and understand the weak points or loopholes in the way your business is operating. This means, not only can you plan better, but even increase your profits manifold.

Some Questions to Ask Yourself Before You Begin

1) Do You Need It?

When you plan to launch a loyalty program app for your business, it is important to evaluate whether you really want it or not. There are some big companies who have evaluated after investing in great loyalty programs that loyalty among their users grew at more or less the same rate or sometimes slightly slower as compared to other companies that did not invest in it. The scenario however may be entirely different for you because of the size of the company, the core product, your business model and so many other factors. It is absolutely essential for you to give the whole idea a thought and evaluate its need in an unbiased manner.

2) How to Make the Most of a Loyalty Program with Mobile Apps?

apps makerThrough a loyalty program a customer gains points or rewards from you when they make a purchase on your mobile web or app. You gain the money that they choose to spend on your portal, but is that all that you have gained here? Think again. When a member of your loyalty program is making a purchase, they are letting you in on a lot of information about a lot of things including what kind of products they are buying, how they are buying them, when they are buying, and most importantly, where they are buying them from (if you’re tracking their location data) Now you have a whole lot of data in front of you, what do you plan to do with it? Simple, enhance the lives of these users and make it easier! While stunts & promotions may help you get the attention you covet, and gamification might help you retain the customers you have gained, but what really matters at the end of the day is – have you done anything through your app to make the customers’ lives easier and more enjoyable?

2.1 Personalization

What do you think personalization is all about? We think, empathy. It is only when you have some empathy for your user would you be able to personalize any experience and it is through empathy that you gain loyalty as well. Mobile devices and the mobile apps have the ability to offer you a peek into the lives of your users as they go through their everyday lives and have their unique interaction with your brand and app. It is this innate capability of the mobile device that makes it possible for the app developers to continually work on the user experience and enhance it, encouraging the users to keep coming back for more. When you identify the needs of your users correctly and prioritize them, you exhibit empathy, which in turn creates a stronger loyalty as well. Whether it is gamification, location-based marketing, a secure payment system, machine learning or one of the many things that help create a better user experience, and deeper loyalty among the customers for the brand.

2.2 Gamification

This is a technique that has stood the test of time. What began with a classic punch card has now evolved into badges, ribbons, or designations that you earn within the app as you progress from one milestone to the other. There is this innate competitive spirit among people that comes into play here and gets gratified as they strive to achieve one milestone after the other. Like TripAdvisor, Untappd and many others, you can award badges and designations to indicate and reward the members’ contribution to your app and their loyalty to your brand.

2.3 Geo-Marketing

The intent of a loyalty program app is to reward the key users with a genuinely amazing user experience, and in order to do so, the experience must be personalized. The sure shot way to bring personalization to its highest is to explore and make good use of the content based on the location where your user is based at that moment. Starbucks’ mobile-only loyalty program Starbucks Rewards is a fabulous example of this. Location-based marketing allows the users to find the nearest Starbucks and order from them, so that their coffee is ready to be picked up the moment they reach the outlet and they can earn stars to move a little closer to their next milestone.

2.4 Mobile Payments

The total mobile payments are expected to reach $503 billion by the year 2020, and this enormous growth is partly attributed to mobile loyalty programs. It is natural for the customers to feel a little hesitant about paying through the mobile, but when the program is intelligently designed around an app experience for the customer while offering them a clear incentive when they purchase via mobile payments, the hesitations are allayed.

2.5 Machine Learning

Quite like geo-marketing, machine learning offers you the capability to create an experience of a personalized rewards program for the customers. If you were to make a choice between a rewards program that was blasted out to all the users (irrespective of their buying behavior and their interactions with your brand) and a program that was designed on the basis of their buying behavior and interactions, which would you choose? Which one do you think would be more effective? Employing machine learning in order to implement an omni-channel marketing strategy can take you far as far as marketing is concerned. User data is demonstrably better integrated through systems, which can then enable your apps to offer rewards and incentives as a part of loyalty programs on the basis of what would interest the users, instead of just forcing them to accept what you think they’d like. If you have been ordering your favorite pasta from an Italian café, you are not likely to appreciate a reward of garlic bread from them for your loyalty.

3) Why Does an App Based Loyalty Program Succeed?

how to make an appThe success of loyalty programs is backed by a lot of psychological aspects and principles, which is probably why it works better than most other marketing strategies. Endowed Progress Effect is supposed to be at the root of the success that the loyalty programs seem to enjoy. This is the phenomenon that takes place when people start working towards a goal or objective. In case of loyalty programs, the objective is acquiring the rewards set out for the users or customers. According to Endowed Progress Effect, as people achieve higher points or rewards and make more progress, the commitment to continue and earn more rewards grows stronger.

4) What Makes It Irresistible?

To develop and gauge a successful loyalty program, marketers define two defining components. The first component is the ease with which the progress can be tracked, and the second essential component is the value and relevance of the reward for the user. Appy Pie however considers a third component which is equally if not more essential – the creativity of the loyalty program. While the essence of the loyalty programs should be similar to what has worked for so many others (may be even you in the past) but there should be novelty that would make the customers interested and curious. The punch cards may work well, but they’re not really greatly effective. One of the most important things is that the customers or the members of the loyalty program should be able to track their progress (which is how the Endowed Progress Effect is supposed to kick in). You have to make sure that they can physically see and perceive their progress in real time towards their reward goals so that they stay committed to it. If the users can not see their progress, they are bound to lose interest. A loyalty program that is mobile based has a great space where the loyalty program members can easily see and track their progress. It is for this reason that placing a simple step of adding a progress bar on the loyalty tab within the app bears great results by showcasing to the customer how far they have come and how little they have to go to reach their next milestone. The second component – the type, value, and relevance of the rewards is of great importance too! It is simply because, if what you are offering is of no interest to anyone, no one is going to do sign up! When you are considering the value, you are going to offer, you must create different levels of rewards. The Platinum level award is what the users covet, but the Bronze levels are important as well. The smaller level awards cater to those who are not looking for a World Trip and make a long-term commitment to you. Additionally, the rewards that you offer should have some kind of connection or relevance to your brand, the products you offer, and what your company stands for. Rewards that fail to connect the customers to the brand, the company and their offerings tend to have a negative impact on the loyalty program and its success. Though people would love getting a free gift, but it’s better not to make random reward offerings that you seem to think that people want.

Concluding Note

Loyalty programs have always had the ability to bring in and develop a pool of hyper loyal customers. This pool of hyper loyal users is extremely valuable as they are highly active when it comes to promoting your brand and bringing in more business through word-of-mouth. It is because of the highly interactive characteristics of the mobile apps that they present a hospitable environment for your loyalty program to succeed. The modern consumers tend to favor those brands that offer them rewards for their long-term loyalty through creatively designed loyalty programs. This can improve the chances and measures of your app’s success as more and more consumers would be encouraged to download your app, and eventually become active users of your app, which will ultimately lead to higher number of downloads and better performance of the app and the brand!Create Your Own Loyalty App

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Abhinav Girdhar

Founder and CEO of Appy Pie