Ending a customer loyalty program

Not every loyalty program will be successful. Maybe it's not producing the results you like, costs too much to administer, or you just want to simplify things.

The problem is, if you just stop then you'll upset some customers who were using it. Especially if you used a points or rewards system that the customer has been saving up for.

No long likes losing something they earned.

The best thing to do is to transition the program into money-off or freebie coupons. Don't make the coupons expire and be generous in the conversion and customers will be happy.

For example, say your loyalty program's offer was earn 100 points to get 10% off. You have a mix of offers you can make:

  1. everyone with at least 1 point gets a 10%-off coupon
  2. customers 1-50 points gets a 5%-off and 51-100 points get a 10%-off coupon
  3. customers get a 1%-off coupon for every 10 points they have (1-10 points: 1% off, 11-20 points: 2% off...)

The first one is the easiest and most generous one but depending on your margin, it might hurt too much.

You can also do this with free gifts. Give customers the choice of which gift they want and send them a coupon to use in their next order.

The important thing is to give more than the loyalty program would and "convert" the loyalty program into regular coupons.

Once that program's ended, you can experiment with a different loyalty program or even a completely different way of rewarding loyal customers.

Repeat Customer Insights includes advice around rewarding loyal customers (and nudging the rest to be more loyal) as part of its Automatic Segments. That advice can be used to build your own loyalty program and help retain your best customers.

Eric Davis

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