Do Loyalty Programs Have to Include Cash or Points Value To Be Effective?

Written by Tom Peace

Loyalty programs have created a huge impact for companies by improving customer retention and increasing brand awareness. Over the last year we have released insights about the increase of loyalty programs. But today, The Loyalty People wants o explore what makes a Loyalty program and ask our community

Do Loyalty Programs Have To Include Money or Points Value To Be Effective?

Over the last 20+ years, point-based loyalty programs have become the industry standard for rewarding retaining customers. Companies like Nectar and British Airways have dominated the sector and set the standard for a successful loyalty program.

In recent years, we've seen numerous businesses develop new ways to reward loyal consumers without relying on the old but constant point-based approach. Companies must adjust to consumer spending habits, and statistics reveal that customers are spending less and less each year as a result of economic concerns related to the Cost of Living Crisis.

Many businesses still believe they do not offer a loyalty program to their customers since their reward system does not allow customers to earn points, promote cash back, or provide unique discounts. Companies that provide any option to promote customer retention that was not previously possible are demonstrating loyalty.