Maximizing the Value of Your Loyalty Program: The Power of Reward Exchange
Loyalty programs have long been an effective way to reward customers for their repeat business. With modern technology, these programs can offer unique rewards like discounts, free products or services, and exclusive offers or experiences.
Most programs offer a predetermined reward chosen by the business. While this can still be effective in driving customer loyalty, the reward is unlikely to align with the individual preferences of every customer. This can prevent the program from reaching its full potential, and make it hard for you to engage more customers.
What if you could let customers choose exactly what reward motivated them the most? Keep reading to learn how a reward exchange can maximize the value of your loyalty program.
In this article:
- What is a reward exchange?
- What are the benefits of letting customers choose their own rewards?
- What are some tips for implementing a reward exchange?
- How does a reward exchange work in SaaSquatch?
What is a reward exchange?
Having a reward exchange means letting your loyalty program members trade their rewards or points for their choice of reward. It’s an easy way to create a sense of ownership and personalization that basic loyalty programs often lack.
This lets you offer a selection of rewards that are relevant to a broader range of individual preferences. As a program manager, instead of trying to guess which rewards your customers want most, you can offer multiple options that satisfy different needs, all while learning more about your user base.
For example, let’s say you let customers collect loyalty points for making purchases, referring friends, subscribing to your newsletter, etc. Once they’ve earned 100 points, they visit your reward exchange to redeem points for their choice of a gift card, company swag, or a discount on their next bill. They can choose what appeals to them the most, without having to wait for a reply from your support team.
The benefits of letting your customers choose their own rewards
Why design a loyalty program with a reward exchange?
- Streamline the customer experience: A self-serve reward exchange lets your customers access their rewards and benefits whenever they want, without the need to wait for assistance from customer service. This makes the loyalty program much more convenient, even reducing your business costs when you don’t need manpower to manage the reward redemption process.
- Boost program participation: When your program is easy to use and offers valuable rewards, customers are more inclined to participate. This also means they’re more likely to make purchases (or complete other profitable actions) in order to earn points that can be exchanged for a reward they actually want. The rewards offered in your program can be the reason someone decides to participate or not.
- Learn more about your customers: By offering a range of reward options, you can gather valuable data on the preferences of your customers. This can be used to tailor marketing efforts and improve the overall customer experience. For example, if you find that 90% of customers are choosing a Starbucks gift card for their reward instead of a billing credit, you can leverage this particular incentive and delight your customers throughout the rest of their journey, knowing they will be enthusiastic about receiving it.
- Make customers feel valued and in control of their experience: With a self-serve reward exchange, customers have more control over their participation in the loyalty program and what they get out of it. If customers feel appreciated and valued as a result of participating, they are likely to spread the word to friends and family. In fact, 73% of loyalty program members are more likely to recommend brands with good loyalty programs.
- Scale faster and keep up with changing trends: Because a self-serve reward exchange doesn’t rely on the involvement of customer service or technical support staff, you’re able to easily scale and meet the needs of a growing customer base. This helps you expand your loyalty program more efficiently when you don’t need to dedicate more human resources to facilitate customer participation or go through a lengthy development process to switch up the rewards.
Tips for implementing a reward exchange option in your loyalty program
If you’re considering implementing a reward exchange option in your loyalty program, there are a few key things to keep in mind:
Offer a range of reward options
While the key to a reward exchange is having multiple incentives, it’s important to carefully consider what you offer. Customers want choice, but can easily be overwhelmed with too many options. Use information from your marketing personas, ideal customer types, and more to design a collection of appealing incentives. For help with choosing your rewards, check out our series on selecting rewards that attract and keep the right kinds of customers.
Set clear guidelines for the reward exchange process
Clearly communicating to customers how your reward exchange works is key to avoiding confusion and frustration with your program. Make sure that the reward redemption process is frictionless and easy for customers to understand. This boosts your program’s credibility and customers' confidence in your brand, increasing overall participation and satisfaction.
When promoting a loyalty program, we always recommend creating an explainer page with information like how to earn points, if/when points expire, how to redeem them, etc.
Use customer data to inform your reward options
If you don’t measure it, you can’t improve it! It’s important to regularly measure and analyze your program's performance, using both program data and feedback from your customers, to make adjustments to improve its effectiveness. For example, if no one has selected the “Free Company T-Shirt” reward in six months, then remove it! Maintaining a high-value selection of rewards demonstrates to customers that you are committed to meeting their needs.
How a reward exchange works in SaaSquatch
When you run a customer loyalty program with SaaSquatch, it’s easy to let your customers choose their favorite rewards. It’s even easier for you to swap out rewards to keep up with new trends and changing preferences.
In your program, customers can exchange credit for any reward on the SaaSquatch platform. This includes gift cards, cash, discounts, custom reward units, and more.
Once you enable the reward exchange in your program, participants will be able to browse a list of rewards available to them. The reward exchange process is integrated right into your existing widgets or portals, so your customers don’t need to open any extra links or remember a new set of login credentials.
For more details on what a reward exchange looks like in SaaSquatch, check out our documentation.
Ready to level up your customer marketing program?
Reward exchange programs can be a powerful tool for marketers looking to increase customer loyalty and drive repeat business. To get started with reward exchange in your existing SaaSquatch program, contact your account manager or view our technical documentation.
If you’re new to SaaSquatch and want to know more about how we can help scale your referral, loyalty, and rewards programs, please get in touch!