Modern loyalty programs range from traditional points and rewards programs to more advanced programs that influence desired purchase behaviors through personalization, multichannel experiences, intricate tiers/levels, and more. To craft a state-of-the-art loyalty strategy, there are certain capabilities the best programs have in common to make them both highly personalized and engaging.
In Forrester’s new Retail Topic Insights 2 Survey, 2024, they indicate that “nearly half of US online adults agree that they are more likely to make impulse purchases when they belong to a brand’s loyalty program.” (Source: Forrester, Loyalty Programs Motivate Millennial Purchases, 14 November 2024.) Once you have the right mix of loyalty capabilities fit for your company, you’ll begin to attract the loyalty program members more true to your brand, utilizing these capabilities to create incremental revenue, boost membership, and grow a larger customer base.
In the words of Roger Williams, Marigold’s Head of Loyalty Center of Excellence, “There’s a gap between [loyalty program] members who simply want a rebate program and a coupon program. …The marketer-centric, liability-management-centric approach in loyalty programs is not appealing to customers.”
Customers want an all-inclusive package that includes various features and benefits, making it a well-rounded, comprehensive program with multiple reward opportunities.
Some key loyalty program capabilities you should consider when you’re looking to uplevel your current program or migrate to a new platform include:
Incentivize and recognize your best members with a configurable tier structure to give them unique earning opportunities and rewards based on program level. Members feel a sense of satisfaction, exclusivity, and higher status when progressing from one level, to the next. An example of this in the restaurant industry is Nando’s loyalty program – Nando’s Rewards (whose members are called Chillies).
The Nando’s Rewards program takes a well-known punch card-style system, and spices it up with enticing, chili-themed rewards.Customers earn a chili each time they make a qualifying purchase – redeemable for various menu items on future visits – moving them along a journey to the next level, each with more and better menu items.
Retail brands have an especially strong foothold on the tiers and levels game, with companies such as Nordstrom and Bloomingdale’s offering private or early sale access and other perks to their customers, who are either Nordy Club or Bloomingdale’s Loyalist members, respectively. Their perceived clout has much influence on their loyalty. In fact, exclusive access to offers, services, and events is one of the most desired components in a loyalty program, as 88% of consumers surveyed in July – August 2024 desired them (according to Marigold’s 2025 Relationship Marketing Trends: Brand Rankings Report). Consumers are always looking for the next-best offer; and your elite or premier clients are no different.
Get to know your existing members better. Progressive profiling features allow you to collect added information about your members to learn about their interests and preferences. When gathering valuable preference data or zero-party data (ZPD) directly via web and in-app experiences you’re creating progressive profiling within your program. This allows personalization of messaging to these members to increase at an exponential degree. Most brands have an app these days, so progressive profiling filters down to the app level, too.
Smartbox, the European gifting company and Marigold customer, created a series of contests and games to increase their gift-giving customer engagement in their non-peak holiday season: summer. Gathering profile information during post-contest online experiences following these games led to a 28% increase in purchase volume, and 58% increase in average basket.
Gamification allows you to build various milestones, track members’ achievement through badges, or rank members on leaderboards. One reason gamification works is the added excitement involved. It also sparks some loyalty members’ naturally competitive nature. No need to discourage that! Go all in.
For example, KFC’s app using Marigold’s Loyalty platform – helped them gain 1 million members to their transformed loyalty program straight after launch. “You want to recognize the customers that visit you often. … Giving them more opportunities for rewards that they wouldn’t get with other rewards programs,” says Paul Tuscano, Chief Digital Officer, KFC. “Consumers can really relate to the brand, really get excited about it.” Their in-app variety also makes it a no-brainer for anyone who frequents KFC, as you’ll see Tuscano explain in this video.
A 360° view of your member for a source of truth, compiling all their data in one view and giving a clear snapshot of who they are, what they want, and how to build a lasting connection with them. This allows you to better personalize your marketing emails, SMS, push notifications and others: a great way to make your customers feel seen and not just sold to.
Having a loyalty platform that stores all of a member’s profile data, from purchase history, to preferences and other data points like their birthday, allows you to make these highly personalized touches in messaging. Some brands – such as those with basic points programs – don’t store this level of information on members, so they can’t particularly personalize their messaging or programming. Distinguish yourself by being one that does.
Leverage unique member identifiers to recognize members across channels, such as email, member ID, digital card, and mobile number. Marketers should ensure that the consumer’s information is always up-to-date and accurate. This enables real-time reactions by individual customers to be recorded per your program’s specifications. These unique identifiers give you important demographics so you can personalize with local offers or preferences for communication channels, for example. Ultimately, this all works together to improve your ability to personalize the program towards a better customer experience for that member, increasing their loyalty.
Incentivizing members with points for both transactional and engagement behaviors such as purchases, surveys, product reviews, or event participation, with a rules-based configuration uplevels any loyalty initiative. One example is Great Wolf Lodge. Previous to their loyalty program, their return guest ratio could have been more impressive. In implementing their new program, the Voyagers Club, they created earn rules designed to include all dollars spent by guests anywhere onsite (not just room stays). Ancillary purchases, like gift shop and in-house restaurant tabs, are also eligible for points. It’s resulted in the company’s loyalty initiative becoming award-winning. Great Wolf added 1.7 million members in their first 12 months, helping drive double-digit percentage growth in that repeat guest rate.
Move members from one audience segment to another based on advanced criteria. Dynamic segmentation categorizes customers or data into distinct groups based on real-time data and behavioral patterns. This allows you to shift a customer’s segment once you’ve added more preferences to their profile – which in a loyalty program will push them to engage even more. Taking advantage of these real-time customer behaviors means tailoring the loyalty program effectively, knowing that consumer reactions and engagement are ever-changing, evolving as a customer continues to engage with your brand, (becoming more loyal in the process!). By utilizing these real-time data points, a more personalized and timely loyalty rewards experience will resonate with each customer segment.
These offers target your customers with highly personalized promotions online or in-store. Smarter offers, like single-use coupons and closed-loop offers recognized at the POS instantly, are ever-popular. You incentivize customers with memorable experiences that will build a growing community of brand advocates. These loyal advocates are the reason a highly customized loyalty program – built on personalized offers that recognize and reward all customer behaviors – builds the best, ongoing relationships. See more ways you can manage and target personalized offers here.
Donatos, a Marigold Loyalty customer, creates more repeat business and loyalty across its loyal customer base, promptly seeing a 23% increase in membership. Its Donatos Pizza Love Rewards accounted for upwards of 98K+ transactions created via on-demand rewards, at last report. Progressive profiling weaved throughout their program allows them to target customers’ preferences to achieve these results.
A spin on the old paper punch cards, these are another method of getting consumers to repeat purchases, online or in-person. They incentivize member behavior and track their progress over time by asking a member to purchase specific items or perform specific sets of actions. For example, actions include completing a consumer survey or writing reviews which count, in addition to purchases. These are typically accessible via their loyalty program app or online on websites.
Below are examples from other QSR chains and grocers using digital punch cards to get traction:
The analytics for your loyalty program can offer sophisticated and customizable dashboards to analyze data on campaign performance, operational activity, and member behavior to gain new insights and readily turn these into actionable campaigns. Improved performance and reliability, an option to enable self-service custom dashboard management and other technical capabilities are some. Thanks to features like simplified navigation and a user-friendly interface, the non-technical marketer has much to gain from analytics built into their loyalty program.
Customer referrals are a strong source of any new customer acquisition or loyalty program. To implement this feature, try these:
- Give your customers unique referral codes and allow them to cash in on rewards.
- Give them a buy one, get one offer: a perk for themselves, another to pass along to family/friends enticing their participation.
- Incentivize members to advance to the next level after a given number of referrals (10, 20, 50).
The example below is from the meditation/wellness Calm app.
Once you have the right mix of loyalty capabilities that work for your company, you’ll begin to attract the loyalty program members that will be true to your brand, activating these capabilities to create incremental revenue, boost membership, and grow a larger customer loyalty base.
- McDonald’s, Donato’s, Bloomingdale’s and even brands like FitBit and Nike all have loyalty programs that utilize one or more features above.
- Gamification and tier/level programs aren’t for everyone, (Finserv, for example, prides itself on treating all customers equally, so a gamified experience with tiers and levels might not work, there.)
- With dynamic segmentation and single-member view, you can really hone in on your specific segments and customer preferences. Take advantage of these to make the best personalization experience.
As Roger Williams states: ”One of the most reliable methods to create incrementality…is to exploit the period after a member redeems their points; we call these golden moments, and they’re magical.” – Imagine your brand’s “golden moments,” and reverse engineer your program from there.
For more information, access our Loyalty Optimization Guide, here.