A retailer’s favorite customer is one who continues to come back for more, satisfied with their products or services so much so that they refuse to do business elsewhere. Customer loyalty can be achieved simply by providing a product or service that’s exceptional or truly unique. Alternatively, some retailers incentivize customer loyalty with exclusive discounts, rewards or special access to products. These are just a few examples of how retailers can secure life-long customers and watch eCommerce sales increase. It starts with a great product, but there are endless possibilities for ways to keep your customers coming back.
Customer loyalty programs could be a valuable strategy to grow your business and see long-term success. It’s more cost effective to retain customers than to acquire new ones and your repeat customers will advocate for you if you go the extra mile to provide a unique and remarkable experience. In 2021, 70% of Macy’s transactions were tied to their customer loyalty program. Some common types of loyalty programs are points based, where customers can receive points for every dollar spent that can later be traded in for discounts or gifts. Another kind is tier programs, where customers can receive different levels of benefits based on how much they spend with the brand. There are even programs where you can pay a fee to receive the program’s benefits.
One example of a points-based loyalty program is Starbucks Rewards, with 31 million active U.S. members in 2023. Every time a customer purchases their items through the app, they accrue points that can later be redeemed for a free beverage, food and even merchandise. The Starbucks Rewards program contributed to 41% of U.S. sales in 2023.
An example of a tiered loyalty program is Sephora: Beauty Insider. As someone who does occasionally purchases cosmetic products, I can attest to the benefits. This combination of points based and tired programs rewards points for every dollar spent that can be exchanged for gifts or discounts. Depending on how much you spend in a year, you fall into categories that come with different benefits. There is even a community aspect that allows customers to ask questions and share product recommendations. Sephora’s Beauty Insider program has 17 million members who were responsible for 80% of sales in 2023.
Probably the most well-known paid loyalty program is Amazon Prime. Though this type is a little less common, Amazon Prime is a paid loyalty program that had a serious impact. With Amazon Prime, members receive free two-day shipping on all purchases with a yearly fee. For retailers who offer similar products or services, it can be a challenge to stand out. Amazon Prime is what differentiates Amazon from other retailers who offer a similar experience otherwise.
There are many benefits to incentivizing customer loyalty. As we’ve seen above, loyalty programs can be highly effective in retaining customers and increasing eCommerce sales, but they can also help to grow your business as your return customers will spread the word about your excellent service, it can help to build trust with your customers resulting in fewer returns, it can increase average order value and it can attract new customers as well. According to data from HubSpot, returning customers are 50% more likely to try one of your new products and are willing to spend 31% more. Consider the value that a loyalty program can add to your business and learn how to keep up with growing customer demands. If you’re looking to increase eCommerce sales or for ways to improve the customer experience, your eCommerce platform could be holding you back. Schedule a consultation today to discover how our eCommerce platform, marketAgility could be the key to your business success.
Last Updated on February 19, 2026 by Team Virid
