How Loyalty Programs Help You Build Customer Loyalty for Your Mobile App

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Posted: September 21, 2017

Continuous customer engagement is the ultimate aim of every business mobile app. To achieve this companies resort to various techniques and a loyalty app is just one way to reward their loyal customers. This amazing user retention strategy inspires the user to come back to your mobile app time and time again.

Now coming to rewarding your loyal customers, this can be done in two ways:

  • Digital Rewards 
  • Physical Goods 

There are various kinds of loyalty reward programs on the basis of physical goods. For an individual business loyalty apps can be built in form of a marketplace where customers will get daily deals. The same thing holds true for brands also.

Types of loyalty apps

Loyalty apps for Retail Business

In this model a customer earns points within a brand app for making a purchase of a particular good or service. Now, these points can be used as in-app currency and can be exchanged for any reward.

To ensure a loyalty program success, a vendor should know what customer desires and what his or her expectations are. Even though you’ll find it tough to analyze a customer need initially, carry out customer research to understand user interaction with the app. For loyalty programs to be successful, you should know what customer wants out of your mobile app.

In low margin businesses loyalty rewards programs are not commonly used as the business model seems unsustainable.

Example of app based loyalty program-Starbucks loyalty program

Starbucks is a brilliant example of an app-based loyalty programs. This hugely successful loyalty reward program awards stars as in-app points. If you earn sufficient stars and you will be given a free drink. But again this you will get if you own a registered Starbucks, La Boulange or Teavana card, or if you make use of the official Starbucks app. This Starbucks mobile loyalty app presents personalized service, and this is the reason it is highly admired by the customers.

Why Starbucks loyalty program is a hit?

Starbucks enables you to pay via the card or a mobile device thus keeping pace with most up to date technologies and motivating customers to make use of their loyalty program. This technique of integrating loyalty cards with mobile payment has been quite successful.

The loyalty programs used by the grocery stores are not as good. Starbucks went a step ahead and offered a gift card to their customers. The company even recognized that customers prefer to pay with a credit card instead of cash. To meet this customers preference, it created a super fast alternative to swiping credit cards at payment terminals.

Its one-touch mobile pay system makes paying for you coffee convenient and minimizes in-store waiting time in a big way. All you have to do is just scan the on-screen barcode at point of sale. The app is connected to the loyalty cards which the customer uses.

Paytm – Another app bases loyalty program

Paytm is also a very popular mobile payment system in India with whooping 200 million registered users, which encourages app-based loyalty campaigns. It enables the local businesses to accept mobile transactions by making use of iBeacon, NFC and QR Code technology.  In order to pay via Paytm, users just scan a QR code, make payments and for every transaction they get a cash-back to their Paytm wallet.

Daily Deals – another kind of App-Based loyalty program

There are several marketplaces where people can get daily deals. A well-known name in this category is Nearbuy, which is a deal discovery platform. In order to build a marketplace like Nearbuy you have to get into partnerships with the local retailers, who need to be convinced of advantages of daily deals for their brand promotion as well as customer loyalty strategy.

Nearbuy offers its customers multiple deals in a day in various categories.  Numbers of deals are limited to certain number with terms/condition applied. Nearbuy makes money by keeping certain % of the money which a customer pays to buy a deal.

Loyalty platforms for the brands

Brand loyalty apps are an integral part of brand promotion. The app basically works with wide array of retailers. It offers rewards from any specific brand which fall under ambit of this app. In this model, customers usually collect in-app points when they make buys at different retail stores.

These third-party apps offer a loyalty platform to a brick-and-mortar store and with no need to maintain their own app. It’s about the relationship between the customers and the loyalty platform, and not between customers and the retail store.

Example – Shopkick

This mobile loyalty app is a fine example of this kind of loyalty platform. The customer information stays with the app provider only. The customer data is handed over to retail partners, Skopkick does not reveal any identifiable user data. So, basically this is a third party loyalty platform where benefits accrue for the third party and the customer.

App Marketing Companies

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The customer gets kick points as he or she enters the store, scans the items and does some purchasing. The points can be redeemed by way of gift cards from different retailers, iTunes song downloads and even popular movie tickets. Customers can even get special discounts on certain products at specified stores.

For every kick which the customer gets Shopkick earns a profit. It even gets a certain fixed percentage on each and every purchase which is done via this app.

So, in short if you cannot develop a loyalty program application, make use of one which already exists. At times it makes sense that you benefit from an already existing loyalty platform which has partnerships with wide range of brands.

So, go ahead and check which loyalty program is apt for your business and engage enhanced customer interaction via that program. Businesses have to continuously come up with strategies not only to make new customers but also to retain and make profits from the existing ones.

If you would like to discuss more about successful loyalty program strategy or loyalty program integration for your mobile app business, mobile development experts at Octal IT Solution are ready to help you. You can reach them at the following email.

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