Upgrade your loyalty program into a key revenue driver

It’s not just you: loyalty programs are everywhere. Whether your company sells jeans, delivers food, or rents cars, you probably have a loyalty program—or you’re part of the 1 in 3 businesses without a loyalty program that will create one by 2027.

Sure, everyone has a loyalty program, but relatively few companies are really doing loyalty well. Regardless of your plan for customer loyalty or your satisfaction with your results so far, there are things you can do today to step up your game to drive more repeat customers, revenue, and brand affinity.

In this blog, we’ll explore a modern loyalty framework, which gives you the strategic foundation you need to improve your program. Then, we’ll explore the data and technical building blocks that can help you turn that framework into action.

A framework for a more strategic loyalty program

Whether you’re planning a loyalty program for the first time or evaluating an existing one, this modern loyalty framework can help you quickly re-align your program with your business priorities and your customers’ expectations of your brand.

Start by aligning on your loyalty program’s mission. Understanding what matters to your business—like increased customer lifetime value, higher purchase frequency, or enhanced brand advocacy—lets you optimize your program to that goal and measure your progress and ROI.

With that goal in mind, calculate the possible impact of a successful program. In the best-case scenario, how much does this loyalty program change the financials of your business? This calculation will let you plan how much you’re willing to invest into the program, and again help you benchmark the program’s success as you improve it over time.

Now, you get to the fun stuff. Design a program strategy that outlines how customers earn rewards, what those rewards can be used for, and how this changes the customer experience. With that strategy in mind, you finally put the plan into action by executing it across your technologies and customer channels.

This all might seem logical, but most companies skip steps in this framework—and their loyalty program suffers as a result. It’s all too easy to jump straight to the strategy and execution stage, implementing points and reward systems without really aligning on the business impact you’re trying to accomplish, or the overall customer experience you want to create. Luckily, this framework will work just as well to reshape an existing program as it will to start a new one. Massive Rocket has shared more about this framework here if you’re interested in digging deeper.

Taking action to reach your loyalty program goals

So what does it take to actually implement a loyalty program? There are two key things you need to get right:

1. Gather a trustworthy Customer 360. You need to be able to track all customer behavior, purchases, loyalty points, preferences, and more, in the same central source of truth.
2. Power engagement from your Customer 360. Based on this trusted data, choose the right actions for the right customers and power those actions across marketing channels, advertising, in-app experiences, and anywhere else you engage with your users.

Building a trustworthy Customer 360

If your loyalty program is going to engage with customers holistically, your Customer 360 needs to be able to include every essential element of customer behavior and preferences. You can’t just track basic attributes like birthday, location, and accrued points. You need to be able to tie together in-store and online purchases, digital web events, calls to your service team, and more. If you have a data science team, you’ll want them to make ML models about your customers in this source-of-truth, too, such as predicted LTV, recommended products, and more.

Data warehouses are well equipped to be this source of truth. They can accommodate any and all of your customer data, more flexibly and more affordably at scale than individual tools like a CRM (ex: Salesforce), traditional Customer Data Platform (ex: Treasure Data), or ESP (ex: MessageGears) can.

Your Customer 360 should include all key customer behaviors, attributes, and predictions. The data warehouse is the best place to gather this comprehensive view.

Powering engagement from your Customer 360

With your Customer 360 in place, it’s time to take action: Use this data to reach the right customers, at the right time, in the right channels to deepen their relationship with your brand and advance your loyalty strategy.

Hightouch lets marketers build audiences, journeys, and AI agents directly in the data warehouse, so they can power all of their campaigns and loyalty programs. In other words: you can bring your marketers directly to your Customer 360, so they can coordinate all engagements and campaigns from this central source of truth.

Traditionally, marketers build audiences, schedule marketing campaigns, and implement always-on journeys that advance users through a series of interactions based on their behaviors. Now, by using Hightouch’s Composable CDP, marketers can plan out marketing experiences directly in their Customer 360 and deploy them across hundreds of downstream tools from this central hub.

Hightouch now also offers a new way for marketers to accomplish their loyalty program goals: AI Decisioning. AI Decisioning can automate all customer engagements across every channel over time, using AI agents and reinforcement learning to maximize the loyalty program’s goals while minimizing negative outcomes like unsubscribes. Rather than manually creating audiences and journeys, marketers just input the goals they want their loyalty program to accomplish, key program guardrails, and approved creative assets. AI Decisioning also surfaces insights about customers individually and in aggregate, so you can accelerate your company’s understanding of how to effectively optimize your loyalty program.

Whether you want to granularly build audiences and journeys, or automate engagement with AI Decisioning, Hightouch gives marketers the tools to turn their loyalty program strategy into action.

Case Study: PetSmart’s “Treats Rewards” Loyalty Program

PetSmart has a world-class loyalty program called “Treats Rewards.” Launched in 2018, the program now boasts 65 million loyalty members, with 90% of all purchases linked to these members. The program is strategic, aligned to business goals, and executed to perfection.

Bradley Breur, VP of Marketing at PetSmart, shares more about their program and how they use technology to support it, in this video:

Improve your loyalty program today

There’s a good reason that everyone is building loyalty programs: with the right strategies and technologies, they work. Yours can, too! If you’d like more strategic guidance on how to kickstart your loyalty program, reach out to Thierry and the Massive Rocket team. To explore how Hightouch can help you turn your data warehouse into a Customer 360 and source-of-action at the center of your loyalty program, grab some time with our solutions engineers.