5 Benefits of Having A Customer Loyalty Program

marketers discussing a customer loyalty program for their business

Why do I need a customer loyalty or membership program?

Do they really work? 

Those are some of the most frequently asked questions.

To answer the latter, yes they do work. Many studies have been done to show that loyalty programs are proven to help businesses grow revenue. 

A loyalty increase of 7% can boost lifetime profits per customer by as much as 85%, and a loyalty increase of 3% can correlate to a 10% cost reduction

Brand Keys

“But if I want customers to come back, I can just give them good products and services,”  

Yes, of course you can. But so will your competitors. 

Good products and services are important factors to keep customers coming back.

But there is something that’s way more important than that:

Customer Experience

What is customer experience?

It means being proactive in responding to their needs.

It means going that extra mile for your customers.

Engaging with them on a consistent basis and giving them updates on your business.

Making personalised suggestions for them. Sending them birthday rewards.

Recognising them as loyal customers and giving them exclusive discounts. 

That’s what a loyalty program is for. 

If you’re still on the fence about it, here are a few benefits of implementing a customer loyalty or membership program for your business: 

Drive returning customers and get recurring sales

With plenty of options available for customers, you need an edge that sets you apart from everyone else. 

For example, if Aaron is deciding between three places for lunch – and he has a membership card from Restaurant X which earns him points and will ultimately give him a free drink and dessert. Which one do you think he’ll pick? 

Even if he decides on a different restaurant today – say due to a friend influencing his decision – he will still return to Restaurant X another day to earn his points. Unless he’s had some bad experience there. 

75% of customers said they were likely to make another purchase after receiving an incentive 


Being proactive in promotions that coincide with special holidays and birthdays can also help bring customers back to your store. Who doesn’t want a special gift on their birthday? 

Let’s say Sally’s birthday is coming up and she needs a manicure.

While she is scouring for nearby options, Nail Parlour A sends her a text message with a birthday promotion – she is entitled for a full spa manicure for half the price.

She may or may not take the deal – but she’s definitely leaning more towards Nail Parlour A now!

Build a bigger customer base with direct referrals

The best form is marketing is through word-of-mouth. Through referrals, you can encourage existing customers to bring in new customers for you at no extra charge.

It’s free and it works. 

Customers are more likely to take recommendations from their friends or family members, rather than a generic review on your page. 

When your existing customers recommend your brand to their friends and family and convert them into customers, these new customers are your direct referrals. 

These customers are acquired through no cost at all – which is great for you because you didn’t have to spend any extra money to acquire them. 

Which brings us to the next point… 

Save costs on customer acquisition

Building a strong base of customers and constantly engaging with them can convert them into loyal customers

loyal customers at a restaurant

Loyal customers already love your products and services, which means they are more likely to frequent your store – whether online or offline – and that means you can save a tonne of money on customer acquisition. 

You should still continue to invest in acquiring new customers.

But make sure you’re doing something to show your loyal customers that you care and appreciate them – or someone else will. 

60% of companies report loyalty customers spend 2-3X more 


Establish brand advocacy – which is basically free advertising

Just like word-of-mouth, brand advocacy is when a customer voluntarily promotes your brand and raves about it. 

They love showing you off and they’re proud of the relationship that they have with you.

Many take to Facebook, Instagram and Twitter to show off the brands they’re in love with. 

Source: murilopapareli

For example, fans of Starbucks love showing off their drinks on social media.

Nike fans love showing off their new kicks. Sephora fans love showing off their new makeup. JBL fans low showing off their headphones.

That’s brand advocacy. They’re not getting paid. No one asked them to post it.

They did it voluntarily and will continue to do it because they feel an emotional connection with the brand

Make smarter decisions and predictions for your business

Studying the behaviour of your loyal customers can be super beneficial for you. 

If you’re using a loyalty program like Eber, it comes with analytics – which means you can study and analyse the patterns of your customers. 

customer loyalty analytics dashboard by Eber

How often do they frequent your store? What are the popular days? What are they buying? How much do they spend on average? 

All these data points can help you make better decisions for your business moving forward. 

Ready to start a loyalty program and watch your business boom with recurring sales? Start with Eber

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