Customer Experience News & Trends

4 problems with loyalty plans – and how to make yours better

Customers probably flock to your loyalty program, then scatter when it comes time to use it. Here’s why customers don’t participate enough – and how to make yours more effective. 

Less than half of customers who sign up for loyalty plans actually use them, according to the Colloquy Customer Loyalty Census.

Why are they gung-ho to sign up, only to lose interest? Here are four reasons loyalty plans fizzle and how to improve yours:

1. They’re too general

Many loyalty plans offer the same rewards to anyone who buys as people who sign up for the loyalty program. Think about how often you see grocery store cashiers swipe cards they keep at their register for customers who aren’t members.

Make yours better: Create special offers for members to cash in on by exchanging points earned through purchases. It encourages more purchases and builds exclusivity.

2. There’s no bonus

Some loyalty plans provide exclusive offers that make them more intriguing, but customers often want more benefits specific to them.

Make yours better: Roll out occasional bonus point campaigns. Promote a particular product or service for customers to earn more points than usual – or give more reward points for a certain period of time. You might want to limit the time in which they can cash in on the bonus points, too, so they stay engaged for another campaign.

3. There’s no incentive to go the extra mile

Customers are more likely to refer potential customers if they’re rewarded for it. Yet, most loyalty plans don’t offer customers in the programs a bonus for referring customers. And since they’re already your loyal customers, they’re most likely to sing your praises and refer you.

Make yours better: Send periodic messages to loyalty plan members asking them to refer friends and family in exchange for an exclusive offer – a new product, upgrade, trial, special discount, etc. It benefits both them and you.

4. There’s no preferential treatment

Sure, every customer must be treated fairly. But they don’t have to be treated all the same. Don’t loyal customers deserve some preferential treatment?

The right answer is Yes.

Make yours better: Openly favor your loyalty program members. Give them priority service, access to products, sales and services before other customers, customized deals, etc. Make your loyalty plan an exclusive club that has its privileges.


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