Can Loyalty Programs Boost your Conversion Rates?

The concept of conversion rate optimization is based on increasing the ratio of web users who perform a desired action on your website. In a nutshell, this process is strategically based on the notion of creating specific forms of engagement between your customers and the brand.

Conversion rate optimization can be almost anything from how often a customer shops at your store to how they engage with your social media channels.

You will find many people out there that will tell you to improve customer flows or to make your shopping cart more visible in order to boost your conversion rates. Yet, there is a better way.

Loyalty programs and conversion rate optimization go together as they increase engagement, retention and they encourage brand advocacy. An outstanding customer loyalty program is powerful enough to pull customers all the way through the customer journey!

Conversions come in all shapes and sizes. The easiest way to think about them is to break them down to micro and macro conversions:

Micro conversions are defined as customer activities with no direct impact on the bottom line but play an important role in proceeding in the customer journey. This may include: blog engagement, reviews, social shares and newsletter subscriptions.

Macro conversions are customer activities with direct impact on the bottom line. These types of activities might include: quote requests, product sales and service subscriptions.

Instead of continuously trying to optimize micro and macro conversions, you can exploit loyalty program methodologies to various conversions crosswise the customer journey.

Let’s see how loyalty programs will help you boost your conversion rates!

Using Loyalty Programs to Drive Micro Conversions

To be honest with you, micro conversions won’t pay the bills. Nonetheless, they will pave the path. In more details, a micro conversion is a measurable customer activity that eventually will lead to a macro (or otherwise named revenue-generating) conversion.

Browsing for products or services, creating an account and social sharing are only some examples of micro-conversions, and there is numerous way you can use loyalty programs to accelerate and increase their frequency.

Loyalty Programs Inspire Users to Go Beyond the Homepage

A loyalty program symbolizes a commitment to a positive and outstanding customer experience and long-term relationships. It shoes a sense of sincerity and credibility which in turn encourages consumers to further engage with your brand and store.

A loyalty program should be creative so to prove to your customers why your brand will deliver an outstanding experience. Also, your program’s presentation is of great importance in this micro conversion process. Loyalty programs in the form of invasive pop-ups or interstitials are certainly a way to drive customers away from your homepage.

Preferably, give your customers a chance to breathe and decide on their own about their next move. Inform consumers about your unique value proposition without negatively impacting customer experience.

Loyalty Programs Boost Account Signups with Strong Rewards

Loyalty programs are your unique opportunity to encourage account creations well before a consumer checks out. Since users need to create an account to collect and manage rewards, this conversion will rely on your program’s delivery and value proposition.

Welcome points are an amazing way to trigger curiosity in new customers and increase the chances of that customer to create an account. With a powerful call-to-action, welcome points can play an important role that will pull customers all the way through the customer journey.

Likewise, offering a loyalty program with different rewards can motivate customers to create an account to take advantage of these desirable treats. Knowing that they have access to special discounts and exclusive events, customers will most probably be motivated to make more purchases. As a result, your brand and therefore your loyalty program will be on the top of their mind.

This type of conversions occur constantly as a user interacts with your website. So, what happens after they have interacted with your website?

Let’s explore one of the most valuable post-purchase conversions!

Loyalty Programs Reward Customers for Writing Reviews

Reviews are a great proof of your business’s success for many reasons. The most important is that reviews boost conversion rates. For sure, the facilitate the buying process by helping new customers to understand your products. Secondly, reviews indicate a sense of credibility that will most certainly decrease bounce rates and increase conversions. Finally, the true value of reviews lies in their ability to convert users into first—time buyers.

Using Loyalty Programs to Drive Macro Conversions

Let’s look now what loyalty can do for macro conversions.

Macro conversions are the end goal of online retail as they are defined as any key customer activity that has a direct impact on the bottom line. Although micro conversions have a significant role in reaching macro conversions, a retailer should always have in mind to keep their eyes on the prize and not get caught up in optimizing for the wrong metrics. At the end, the key to long-term growth and business success, is no other than building a strong and loyal customer base.

Loyalty Programs Can Convert First-Time Customers

The key to increase first-time purchase conversion is by reducing shopping cart abandonment. One of the most common reasons for shopping cart abandonment is surprise fees at the check out process, for example high shipping costs or excessive handling fees. In order to avoid this type of issues, brand can use a loyalty program to offer redeemable free shipping offers or offer point redemption at check out.

With point redemption, customers will be surprised by the savings instead of being scares away by high shipping fees. Likewise, a smooth check out process is invaluable for first-time customers. You may overcome the above challenge by including a guest check out option or even a simple registration process.

Your loyalty program can help turn these new customers/ accounts into a lasting marketing opportunity. How? With effective customer segmentation and email marketing, you can send them marketing material that are relevant to their interests and keep them engaged and interested in your brand.

Loyalty Programs Convert First-Time Customers to Repeat Customers

After one purchase, there is a 27% chance a customer will return to your store. After the second purchase, that conversion rate jumps to 45%. Therefore, repeat customers are more profitable to your business as they are more likely to convert, and they will likely spend more per order.

Creating the right type of loyalty program and reward system for your brand will increase your program’s conversion power. Most people think that loyalty programs mean points. However, points aren’t always the answer. For example, if you have repeat customers with a high customer lifetime value, it might be best to create a tiered VIP program, as this type of program offers additional value and rewards as customers increase their loyalty.

Since high customer lifetime value customers are expected to spend large amounts of money over a long period of time, the optimal way to keep them coming back is by offering them a sense of exclusivity which they won’t be able to find anywhere else.

Loyalty Programs Convert Customers to Brand Advocates

Brand advocates not only make repeat purchases, but they become and extension of your marketing team! They are not afraid to promote your brand on social media or recommend you to friends and family.

Referral programs can be one of the best forms of loyalty programs for brand ambassadors as they allow you to encourage brand advocacy behavior and identify key brand advocates in your base.

You may build advocacy with different type of programs! For example, you may use a VIP loyalty program with deep personalization by segmenting your customers and then reaching out to them personally. Whether it is a surprise gift or a tailored email, customer surely appreciate brands that go an extra mile to make the shopping experience special.

It is all about creating an outstanding customer experience. An experience that customers can’t help but brag about on social channels and to their friends.


Up to this point we hope that you have clearly understood the power of loyalty programs. In a nutshell, they give you the chance to surprise and delight your customers every single day, helping you personally connect with your audience.

The success of every business begins, grows and ends with its customers. So, make sure that you some them some loyalty too!

Original Article Written by Prisync!