Mar 9, 2023

Everything You Need To Know About A Point-Based Loyalty Program

Ellie Bradford
March 9, 2023

Discover how point-based loyalty programs can boost customer retention & drive revenue. Learn about earning & redeeming points, the benefits of meaningful rewards, & how can help you create an effective loyalty program. Optimize your search engine ranking by implementing targeted keywords and phrases.

Reward Strategy

A point-based loyalty program is a powerful tool for businesses looking to build customer loyalty, drive repeat business, and gain valuable insights into customer behavior. This method incentivizes customers to keep coming back, earn more points, and redeem them for rewards, discounts, or exclusive perks. 

By rewarding customers for their loyalty, businesses can cultivate stronger relationships and foster customer engagement, leading to increased sales. Also, it provides businesses with valuable data on customer behavior, allowing them to tailor their marketing and sales strategies to better meet the needs and preferences of their customers.

Every points-based program is separated into two main categories: ways to earn and ways to redeem. Both of these elements have specific processes to allow your customers to collect points and crucially, how they can spend them. Thus, providing several options on how customers can receive points make for a more personalized and engaging customer experience. 

The Power of Points: Driving Customer Loyalty & Retention 

Earning points is a crucial aspect of any loyalty program, as it is the main incentive for customers to join and participate in the program. By offering reward points for purchases, businesses can encourage customers to come back and make repeat purchases. The point-based system provides customers with a clear understanding of how much they will be rewarded for each purchase, and it provides a clear goal for customers to aim for when collecting points.

When setting up a point-based loyalty program, it is important to determine how many points will be awarded per dollar spent, and how much each point is worth when applied to a purchase. This ensures that customers are aware of the value of the points they are earning and provides them with a clear incentive to participate in the program.

In addition to purchases, businesses should also offer points for other activities, such as following the company on social media, leaving a review, or uploading a photo of their purchase. This creates additional touch points with customers and builds stronger relationships, ultimately driving revenue for the business.

For example, Obvi, one of our customers, offers a customisable earn rule that rewards customers for downloading their app. This encourages customers to engage with the brand in different ways and provides Obvi with an opportunity to increase their app downloads. With merchants have the option to add very flexible Earn-rules thanks to our open API.

The Importance of Thoughtful Point Redemption Options

Redeeming points is the other half of the equation when it comes to loyalty programs. After customers have earned points, they need to be able to use them in a way that makes them feel valued and appreciated. One classic way of redeeming points is to offer fixed amounts off the next purchase or free shipping. These options are straightforward and easy to understand, and they provide customers with a clear benefit for participating in the program.

However, businesses can also consider more flexible options when it comes to redeeming points. For example, product discounts or discounts on subscription plans can be a great way to incentivize customers to continue to engage with the business. With and Shopify Plus businesses can even offer the option to redeem points for gift cards.

When designing a loyalty program, it is important to consider what types of rewards will be most appealing to customers and fit with the brand's products and values. For example, offering certain products for free can be a powerful motivator for customers to redeem their points. FFS is a great example of a brand doing this well with their rewards program. They offer customers the option to redeem their points for free products, and this can encourage customers to try new products they might not have otherwise considered.

Redeeming points is an essential part of any loyalty program, and businesses should consider both classic and flexible options when designing their program. By providing customers with meaningful rewards and benefits, businesses can build stronger relationships with their customers and increase customer loyalty and retention.

Enhancing Customer Relationships with Point-Based Loyalty Programs

In conclusion, by offering rewards for purchases and other activities, businesses can incentivize customers to engage more deeply with their brand and build a sense of loyalty that goes beyond just transactional interactions.

If you are looking to create a loyalty program, a point-based program can be a quick entry point, especially with a program like With a quick set-up and an intuitive dashboard, businesses can easily get started and begin offering rewards to their customers. Get started with our free plan today! also offers a tiered-based loyalty program for those looking for a more complex program, but starting with a point-based option provides businesses with a fast way to explore the potential of loyalty programs.

As businesses continue to refine their loyalty programs, it is important to consider customer feedback and make adjustments that meet the needs of members. At, we are committed to ongoing improvement and providing our customers with even more flexibility in creating programs that fit their brands and the needs of their members.

In summary, a well-designed loyalty program can help businesses build stronger relationships with their customers and drive revenue. And with a point-based loyalty program like, businesses have a simple and effective way to get started on this path.