The lines between online and offline blurring when it comes to sales and purchases.
And the same goes for tactics to increase customer retention across touchpoints.
And that’s where point of sale (POS) customer loyalty programs come into the picture!
What is a POS customer loyalty program?
A point of sale (POS) customer loyalty program is a rewards or points program that gives incentives (reward points) to customers at the time when they make a purchase. This kind of a loyalty program is integrated within the POS system and gives customers rewards, points, and discounts during purchase transactions.
Brands must make it easy for customers to use POS loyalty points to maximize the benefits to customers. For instance, Flits customer loyalty app enables customers to use POS loyalty points both offline and online.
And there are many benefits of a POS customer loyalty program. For instance, it helps with customer retention, increasing customer loyalty, improving sales and revenue, creating a strong brand image, and more.
How does a POS customer loyalty program work?
In this section, we take you through the basics of POS loyalty programs and the elements it entails so you can get an overview of POS.
1. Enrollment
Do you recall shopping at lifestyle stores where, at the time of payment, the customer representative at the billing counter asks you if you are a loyalty member at their store? And if you aren’t they’ll encourage you to become a member to earn more points and benefits.
Online POS customer loyalty program enrollment is somewhat similar. Customers are urged to enroll in the program when they make a purchase transaction. They are either asked to provide basic details such as name, contact details, etc., and are instantly enrolled through this short step, or are asked to fill a form to register.
2. Points or rewards accumulation
Once customers are enrolled, the cycle of points accumulation begins instantly. Customers are given points or rewards with each purchase they make based on the amount. The POS loyalty program tool accumulates points in the customers’ accounts. Customers can track and check their points as and when they like.
eCommerce businesses have the chance to improve engagement by creating strategies around accumulated rewards. For instance, you can send regular notifications to remind customers about their accumulated rewards. Additionally, you can also give them ideas about how to use the rewards.
3. Points redemption
As customers start accumulating points, they can redeem them during their next purchases. The incentives can also be in the form of free gifts, free shipping, discounts, etc., that can be used during their next purchases. Brands may have specific redemption rules as per their preference and strategies.
Here too, you can create strategies and campaigns to tell customers the different ways in which they can redeem the rewards. This makes their experience better and helps you increase sales.
4. Personalized offers
According to an Acxiom study, 56% of customers are more likely to repurchase from brands when they receive personalized loyalty rewards. Point of sale customer loyalty rewards can also be personalized. So, how are rewards personalized? There are many different ways to personalize rewards for Shopify stores. Here are some:
- Merchants can use data from the customer account page to make rewards more relevant to customers
- Conduct surveys or ask for feedback and use the information for personalization
- Observe customer purchase patterns closely and use the data to create relevant shopping experiences
5. Tiered loyalty
Some loyalty programs have tiers or levels. Customers can enjoy different benefits as they reach new levels. For instance, say a Shopify POS loyalty program has three tiers, Silver, Gold, and Platinum. Customers may start with the Silver tier and as they keep shopping more and earning more loyalty points, they progress to the Gold level. Higher tiers offer more benefits and perks. The tiered customer loyalty program encourages customers to spend more and hence increases revenue and profits for brands.
Example of a tiered loyalty program
6. Integration with CRM
Integrating a POS loyalty program with a customer relationship management (CRM) tool can help businesses improve customer engagement. By linking the two tools, you can get an overview of your customers behavior and preferences.
Integrating with CRM enables you to track purchase history and shopping patterns, which can be used to create personalized offers and deals to match individual customer preferences. Additionally, CRM data can provide more data such as customer demographics, engagement level, etc. The integration also enhances operations and workflow, streamlining customer interactions.
7. Promotions and incentives
POS loyalty programs help brands with creating promotions and incentives. For instance, you can offer incentives, freebies, discounts, and perks through your loyalty program.
Your Shopify POS loyalty programs also help you provide instant gratification to customers as soon as they make a purchase. This has positive psychological effects on customers. Continuous efforts can help you keep the engagement going. Optimize your loyalty program based on consumer preference to build strong customer relationships via promotions and incentives. For example, you can offer double loyalty points sometimes.
8. Feedback and engagement
When you make customers feel like they’re a part of your brand, they feel more engaged. And that’s where feedback comes in as a strategy. No wonder 61% of ambitious companies are increasingly focusing on first-party data strategy.
Asking customers to share feedback on products, on their shopping experience, website experience, etc. are great ways to improve engagement and at the same time collect valuable information.
Your POS customer loyalty program can be of help in this strategy. Ask customers to share their feedback on their loyalty program.
What are the benefits of a POS customer loyalty program
Let’s look at all the benefits of POS loyalty programs and why you must definitely set up a POS program on your Shopify site.
1. Improved customer retention
When you give rewards, points or store credits to customers, you create an opportunity to bring them back to your store. And when you give them points every time they make a purchase, you bring them back to your store multiple times. This has a positive effect on your customer retention rate. When you consistently increase retention and reduce churn, your customer loyalty rate also increases.
Here’s an example of Synergee, a Canada-based fitness and sports brand using Flits customer account to set up a loyalty program.
2. Improved sales and revenue
64% of customers who belong to loyalty programs spend more money to maximize points. But this is not the only reason why POS customer loyalty programs can increase sales.
Loyalty programs have many positive emotions attached to it. It makes customers feel happy, appreciated, satisfied, trustworthy of the brand, and creates a community feeling of exclusivity. All these factors have a positive impact on customers, making them want to interact and transact more with brands, thus directly increasing sales and revenue.
3. Improved customer engagement
Shopify loyalty programs are one of the best ways to increase customer interaction and engagement opportunities. For instance, you can send customers regular notifications of their loyalty points, send reminders, create special campaigns, etc.
Moreover, customers themselves feel more engaged when brands have loyalty programs. The excitement of earning points, redeeming points, and seeing what’s new in the program generates more engagement.
Another aspect that creates more engagement is personalization. Loyalty points give an opportunity to create relevant experiences and offers for customers and hence customers feel more connected with loyalty programs.
4. Data collection and insights
Loyalty programs help brands collect valuable customer data. For instance, when customers sign up for a Shopify customer account, you may collect their name, address, and other basic personal details. But with loyalty programs, you can collect more valuable information beyond basic demographics.
For example, you can understand their purchase behavior, how much they spend, their engagement levels with the loyalty program, their preferences, etc. All this information can help you understand customers at a deeper level, further helping you create personalized and more relevant marketing and promotional campaigns to target these customers.
5. Better customer experience
The more you know your customers, the better you’ll be able to help them with shopping on your site. These days, customers don’t engage with brands because of the brand, they engage with the brand because of the people behind the brand.
Loyalty programs can help you define your brand personality. How you interact with customers, what kind of incentives you offer them, how you make them feel special and connected with your brand, and more.
Here’s an example from Snitch that provides multiple opportunities to brands to earn more rewards.
6. Add a competitive advantage
According to a McKinsey study, three out of five consumers spend more on brands after they sign up for their loyalty program. A successfully-executed well-designed POS loyalty program can differentiate your brand from your competitors.
What are some ways to add a competitive advantage to your loyalty program? You could offer unique perks, more points compared to what other brands offer, collaborate with other brands for more engaging offers, and more.
7. Increases brand loyalty
When customers are part of a loyalty program, they get a feeling of belonging. They feel more connected to brands that care to create good experiences for them. And when customers are consistently made to feel good and engaged, it leads to long-term stronger relationships.
These loyal customers then become your brand advocates and spread a good word about your brand, bring more referrals and boost customer loyalty rates.
8. Increases referrals
When customers are happy and satisfied with your business, they would recommend your brand to their friends and family. POS loyalty programs offer rewards and incentives at the time of sale, offering instant gratification to customers.
When customers receive rewards and points repeatedly, their satisfaction improves and they’d want to recommend your brand to their friends. If you have a referrals program, you could combine it with your Shopify loyalty program and increase referrals from your loyal customers.
9. Cost-effective
Acquiring new customers is five times more expensive than retaining your existing customers. But loyalty programs work as excellent retention strategies. This makes POS loyalty programs a cost-effective marketing strategy. Instead of spending marketing budgets on customer acquisition ads, you could double up on your loyalty program.
For instance, offer more rewards, better incentives, and create more engagement to retain customers. Besides, your most loyal customers will also bring referrals and more customers to your business.
10. Enhances scalability
There are many ways in which a well-run POS customer loyalty program can help grow and scale your business. Customers who enjoy your loyalty program, feel connected and are loyal to your brand are more likely to continue doing so rather than moving to other brands. They also help spread the word and bring more loyal customers to your brand, thus helping scale your business.
Get started with a POS customer loyalty program with Flits?
Flits Customer Account Page app offers many add-on features, including store credits. Just like reward points, store credits are a form of cashback that bring customers back to your store to make more purchases.
Flits easily integrates with Shopify POS loyalty programs. Once integrated, your staff can easily enroll customers into the program and customers can start enjoying the benefits.
Customers can check their rewards by singing into the Shopify customer account and perform actions such as redeem or earn more points, etc.
And setting up POS with Flits loyalty programs is really easy. To understand how to go about it, read this detailed blog on our site.
Set up your POS customer loyalty program
Now you know you can set up your POS loyalty program easily with the help of Flits. All you need to do is install the Flits Customer Account Page app on your Shopify store. Our customer support team is here to guide you at every step.
Install Flits Customer Account Page App on your Shopify store.
FAQs
1. What is a POS loyalty program?
A POS loyalty program is a point-of-sale program that offers rewards and points to customers at the time when they make a purchase.
2. What are the types of customer loyalty programs?
The different types of customer loyalty programs are rewards program, store credit program, and tiered loyalty program among others.
3. Who benefits from POS?
Both customers and Shopify brand benefit from POS customer loyalty programs. Customers earn perks, incentives and benefits, and brands increase customer loyalty, sales, and revenue.
4. Which is the best customer loyalty program app?
Flits is considered the best customer loyalty program app by many Shopify and Shopify Plus merchants across industries.
