Jun 21, 2024

How a Loyalty App for Small Businesses Can Be a Game Changer

Kai Jensen
June 21, 2024

In this guide, we’ll review the main benefits of starting a loyalty program, how a loyalty app can help, and strategies to help your program compete for consumer attention.

Reward Strategy

In today’s highly competitive market, maintaining customer loyalty is crucial for small businesses. According to data from McKinsey Consulting, as many as 30 - 40% of consumers switch brands or retailers regularly. This high customer churn rate can cause headaches for small business owners, who rely heavily on repeat customers for their revenue 

High customer churn is an expensive problem. Acquiring a new customer can cost anywhere from five to 25 times more than keeping an existing one. And, 61% of small businesses say over half their revenue comes from repeat customers. 

One way to tackle a high customer churn rate is to implement a loyalty program. Loyalty programs boost sales and customer retention. Nearly 80% of American consumers say participating in a loyalty program leads them to buy from a brand more frequently, and 70% say they spend more time with a brand due to joining the program.

In this guide, we’ll review the main benefits of starting a loyalty program, how a loyalty app can help, and strategies to help your program compete for consumer attention.

Why your small business needs a loyalty program

Loyalty programs are a win-win for small businesses and their customers. A well-constructed loyalty program can: 

  • Increase customer retention by incentivizing repeat business. Customers are less likely to switch to competitors when they are rewarded for their loyalty.
  • Boost sales by rewarding frequent purchases, leading to a more predictable revenue stream for your business. 
  • Enhance customer insights with data from your loyalty program, such as purchase history, preferences, and engagement levels.
    This data lets you personalize marketing efforts, tailor product offerings, and better understand your customer base.
  • Elevate the customer experience by rewarding and recognizing customers who support your brand.
    This recognition makes customers feel valued and appreciated — creating a deeper, more long-lasting relationship. 

Hosting a loyalty program isn’t always straightforward, however. Loyalty programs take careful management, planning, and strategy to net results. Loyalty fatigue can make it difficult for your loyalty program to stand out — especially when competing for attention with bigger brands. 

The challenge of starting a small business loyalty program

Launching a loyalty program for your small business can be a great way to boost customer retention, but it comes with its own set of hurdles, including:

Finding the right rewards and structure for your loyalty program. Rewards must be attractive enough to incentivize engagement, but financially sustainable.

Reward program must be customisable and tailored to for your specific customer base and brand identity. A one-size-fits-all approach might not work. Consider segmenting your customer base for targeted rewards based on purchase habits.

Resource allocation. It takes a number of resources to bring the program to life. A marketing budget, rewards budget, and funds allocated to measuring your program are baseline costs. Offering discounts, points, or freebies comes at a price. Factor in the cost of rewards and ensure they don't eat into your profits.

Setting up a program, even a simple one, requires investment in technology or training. This is where loyalty apps can be total game changers for small business owners. 

The top 4 benefits of a loyalty app for small businesses

Managing loyalty programs can be challenging for small businesses with limited resources. This is where loyalty apps come in. These digital tools help achieve the goals of a loyalty program efficiently and cost-effectively. While a loyalty program is a strategy designed to encourage repeat business by rewarding customers, a loyalty app helps manage and enhance this strategy seamlessly. Loyalty apps streamline the implementation and administration of loyalty programs, offering several advantages:

A loyalty app offers convenience and accessibility for both your team and your customers. Participants can easily track points, redeem rewards, and access exclusive offers from their smartphones. This ease of use encourages higher engagement and participation compared to traditional loyalty programs.

Loyalty apps also give your business the power to send targeted promotions based on a customer’s purchase history and preferences. Your small business can leverage this data to send personalized offers and relevant rewards. This level of targeting is more sophisticated than what’s typically possible with non-digital loyalty programs.

Loyalty apps also eliminate the need for physical punch cards or printed materials, reducing costs and the environmental impact associated with paper-based programs. integrates with both Apple and Google Wallets to digitally access our StampCard and QR code loyalty cards.

Finally, loyalty apps provide real-time data on customer behavior and program usage. Small businesses can track key metrics like customer engagement, redemption rates, and popular rewards. This data-driven approach enables more informed decision-making, and program optimization.

Deeper dive: level the playing field with loyalty apps for small businesses

In the past, loyalty programs were limited to big enterprises with the resources to run them effectively. Small businesses were shut out of running effective loyalty programs due to smaller budgets, lack of data, and the inability to craft programs that went beyond sales to focus on true engagement. 

According to 2023’s Global Customer Loyalty Report, companies have invested or plan to invest an average of $375,000 to launch or revamp their loyalty programs. That eye-popping number is simply out of the range of possibility for most small business owners. 

The good news is that loyalty program apps make running an effective loyalty program possible without the high price tag. These full loyalty solutions, packaged in user-friendly apps, allow SMBs to maximize the benefits of their loyalty program and compete against big-box retailers at a fraction of the cost. 

Why Are These Apps So Important?

The core advantage of using loyalty apps is personalization. Shoppers already favor small businesses for their superior customer experience and personal connections. Loyalty apps give small business owners the power to take that personal connection even further. Apps like offer several key benefits:

  • Personalized rewards & offers: Small businesses can analyze purchase history and preferences to suggest relevant rewards. For instance, frequent coffee buyers might get a free drink on their birthday, while those buying running shoes might receive early access to new athletic wear.
  • Targeted communication: Small businesses can send their customers messages about products they're interested in, upcoming sales on their favorite items, or exclusive app-only discounts. Instead of bulk messages, customers only hear from brands about relevant offers. 
  • Deeper relationships: Small business owners can use their loyalty app to send messages that foster a deeper connection, such as birthday greetings, early access to events, or a thank you for participating in a social media giveaway. These interactions make customers feel valued and strengthen brand loyalty. 

How much does it cost to create a loyalty program for a small business?

The $375,000 estimate by the Global Customer Loyalty Report is just one benchmark for budgeting for your small business loyalty program. Costs range dramatically depending on how you set up the program; simple digital punch cards, for instance, can cost around $40 per month. Naturally, the more features you need the higher the cost. offers a basic plan for just $49 per month that includes all the features needed to make your loyalty program successful.’s starter plan goes well beyond a simple punch card with features like referral rewards, social action rewards, and free birthday points. 

Ultimately, it’s about finding the right combination of features at a price point that fits your budget. While it’s essential not to shortchange your loyalty program with too few features, it’s equally important to create a list of tools you'll need to execute your program successfully. This balance ensures you maximize your investment without overspending. 

Key features to consider in a small business loyalty app

Small business loyalty apps have tools to segment your audience, customize the experience, embrace gamification, and offer exclusive perks. The features in apps like allow small businesses to reciprocate the loyalty they receive from their customers. Here are some reasons should be at the top of your list when you get your options. 

Get targeted engagement with maximum impact goes beyond generic marketing blasts. Our platform is designed to be user-friendly, even for those who may not have extensive marketing experience. integrates seamlessly with various social media platforms, enabling your business to leverage the power of social media marketing to increase brand awareness and engagement. Additionally, our referrals feature encourages satisfied customers to bring in new clients, amplifying your reach organically.

Work within your budget is cost-effective, in addition to being user-friendly. We offer affordable plans tailored to small businesses, making reaching your target audience easier without breaking the bank. 

Scale for success offers detailed analytics and insights to give you a clear picture of your loyalty program performance. Use this information to make informed decisions and optimize your marketing strategies. Additionally, our platform offers scalable solutions that can grow alongside your business. As you expand, adapts to accommodate your increasing marketing and loyalty program needs.

Personalize your program 

Design a fully customizable program in hours with’s flexible platform. Reward customers for actions beyond spending, such as writing a review, sharing user-generated content, or liking a post on social media. Our loyalty tiers feature allows you to personalize the customer experience by offering tailored rewards at different levels of engagement. This gamifies your loyalty program, motivating customers to reach higher tiers for more exclusive benefits, thereby enhancing their overall experience. goes beyond generic marketing blasts with a user-friendly interface and social media integration that help small business owners efficiently manage their campaigns. 

By combining targeted engagement, data-driven insights, user-friendliness, and affordability, empowers small businesses to create impactful loyalty programs that foster customer relationships and drive sustainable growth.

Get started today with

Making your customer loyalty program more powerful has never been easier. Retool your small business customer loyalty program to show customer appreciation and build lasting relationships — your customers will reward you by returning to your business again and again. can supercharge your loyalty program. With features to drive higher sales, send personalized offers, and reduce acquisition costs, is a crucial tool for small businesses seeking to compete with big-box retailers. Learn more about our app by watching a demo of our platform.