Loyalty is an emotional word.

More store owners are starting to recognize the influence of customer’s feeling on how they interact with a brand. Accordingly, an efficient Loyalty Program should now go beyond transactional rewards. It has to create extraordinary experiences that touch all points to keep long-lasting loyalty.

This notion challenges the Traditional Loyalty Program boundaries and gives rise to a new term: Omnichannel Loyalty Programs.  

The Game of Loyalty Programs is changing

Traditional Loyalty Programs provided customers with tangible benefits, such as a free item with purchase or a reward for returning visits. But these offerings were limited in access, only targeting customers already coming through the door.

In other words, traditional loyalty programs only rewarded customers when a transaction takes place, which limits the opportunities to deliver a high emotional experience.

It should include every action, such as when customers promote the product on social media, write reviews about their favorite items, take a product-related quiz, or refer a friend. Also, you can engage customers in everyday activities, such as going for a run in their new shoes or wearing clothing items with smart tags in them.

Source: Loyalty Report – Hubspot 2018

At the earlier time of Loyalty Program History, information and products available to the public were more limited and advanced technology was less widespread. People based their decisions mainly on how much value they got for their money.

With that old mindset, loyalty programs just helped to reduce the cost of discounting and essentially functioned as a cheap currency. Once customers had their wallets full of different loyalty cards, they wouldn’t want to go all the way to shop at a particular store just to earn points.


Customers who receive a discount either come to expect a discount everytime or wait until a discount exists to make another purchase. Instead, Omnichannel Loyalty Programs encourage customers to come back to your site.

In modern retail, loyal customers can’t be determined only by spending behavior and their loyalty can’t be measured based on sales volume. A brand should actively build profitable and emotional relationships throughout Customer Life-time Value, not a single transaction or touchpoint.

Loyalty no longer stands alone but integrates with Customer Experience. As today’s consumer is more discerning and a value seeker, it is a challenge, but also an opportunity to reimagine Loyalty Strategy and rethink about Brand’s Boundaries.

What are Omnichannel Loyalty Programs?

Omnichannel Loyalty Programs focus on the best shopping experience across all channels. This means delivering meaningful engagement through each and every touchpoint, from in-store Point of Sale to social media. Customers engage with your brand on a variety of platforms, devices, and channels, and they expect each one of them to work together seamlessly.

You can read more about concept of Omnichannel and download the ebook FOR FREE here: Magestore’s Omnichannel Retail Guide

Consistency is a key component of Omnichannel Loyalty Programs. However, in the digital age, it’s no longer enough to send one promotional message across all sales channels.

Omnichannel Loyalty Programs might even include personalized recommendations and offers, streamlined purchasing process, and instant access on different devices. Retailers should be ready to adapt and innovate their programs on a regular basis. 

Why Omnichannel Loyalty Programs?

Omnichannel Loyalty Programs are essential to build a profitable Sales and Retention Strategy. They not only improve customers’ opinions about a business, but also bring real sales benefits. 

According to IRi’s 2018 consumer survey, 74% of customers choose a brand based on its strong loyalty or discount program. Additionally, 71% of brands that use Omnichannel Loyalty Programs said transaction volume spurred by these programs increased by more than 50 percent over the previous years.


Customer Loyalty Trend – Source: Adobe Report 2018

Omnichannel Loyalty Programs facilitate businesses to meet customers wherever they are, and reward customers using their currency of choice, whether that’s frequent-flier miles, hotel points, or cash back. This flexibility attracts a diverse base of repeat visitors who come back more often and spend more during each visit.

What’s in Omnichannel Loyalty Programs for Businesses?

Technology for seamless customer engagement

Omnichannel Loyalty Programs offer various ways to engage customers, allowing them to swipe and scan their apps to rewards – all while increasing brand loyalty and boosting sales.

Technologies like chip-based smart cards, RFID, real-time point of sale, third generation of loyalty ‘Rule Engines’-biometrics (include facial and voice recognition biometrics), wireless E-tags, PSAs (personal shopping assistants)… have evolved and supported such strategies. 

Biometric Solution Supports Personalized Loyalty Program – Source: Innovative Retail Technologies
  • For example, a card-linked loyalty program offers desired convenience for customers. Instead of carrying around an additional card or pulling out an app, customers can simply pay with a registered card and automatically receive rewards each time they swipe. 
  • Other trials and innovations in this space include voice biometrics used by ANZ Bank, fingerprint by Delta Airlines and facial recognition within KFC in Hangzhou, China set up by Alibaba.

Value focus: greater opportunity to tap customer lifestyle, the clearer your brand identity in the customer’s mind

Aligning the Omnichannel Loyalty Program’s structure with your brand identity helps to enhance your core message, by connecting your customers’ preferences, passions and beliefs.

For example, you can build advocacy by rewarding customers who donate used clothes at your store, which can make a positive effect on your brand. The health & lifestyle community has reacted positively to Strava and customer rewards. This has great potentials for retailers specializing in athletic sportswear.

You can acknowledge people for going out for a run, and ensure that they are rewarded in your stores afterward, which strengthens their emotional bond with your brand .

Before we thought of Omnichannel Loyalty Programs as just the seamless combination on in-store + online and mobile, but we’ve since added another element: daily life – all those moments when customers are just being people.

Instagram campaign is just one example. This also drives engagement on social media

Data-driven insights to make smarter decisions

Beyond increasing customer affinity for your brand, Omnichannel Loyalty Programs carry another huge benefit: data-driven insights. Despite various gates to reach customers, you can store all the information about your customers in a centralized system. With all these statistics, businesses can learn about the latest trends in consumer behavior. 

For example, a restaurant may learn from Omnichannel Loyalty Programs data that most of their returning customers come in during a certain time, or from a particular suburb. It also identifies what these valuable customers prefer to eat.

The restaurant can target locals during certain times of the day or bring in additional customers from a specific local area. This leads to incremental visits from regular guests and new customers with similar demographic profiles.

Consistency is the key to Omnichannel Loyalty Programs.

Access to customer transaction history allows store owners to have a better understanding of their loyal customers, and learn what differentiates them from other guests. Studying the resulting data and trend really helps businesses make smarter decisions.

What is in Omnichannel Loyalty Programs for Customers?

Customized Offerings

There’s a common misconception that some customers are not comfortable with companies analyzing their transactions.

However, recent research from Nielsen showed that customers are more than willing to share data with brands in exchange of customized offerings. 91% of customers said they are more likely to shop with brands that can provide relevant offers and recommendations — and 83% are open to sharing data to make this work.

This attitude is intergenerational, with 46% Gen Z customers and 55% millennials willing to share their data for a better-personalized experience.

Exclusive experiences that money can’t buy

Customers always want to feel like they are being offered something personalized and original. A VIP experience designed for a selected audience, the privileged few can be exquisitely special.

It’s the perfect mix to convey the wow feelings in Omnichannel Loyalty Strategy and hit the customer’s sweet spot. Data-driven insights, once again, play an important role here to understand which rewards appeal most to your high-valued customers.

For example, the most desired offers for millennials are free travel, SPA days, wellness treatments, event tickets, and exclusive shopping nights/weekends (according to a survey by The Drum).

Or in the fashion industry, rewards for top customers can be Exclusive or Early Birds (early access to new collections, shop the runway) or Quality advice (Face-to-face or virtual meetings with stylists, or store staff).

Let’s make difference to your Loyalty Program

We all know that it costs a lot less to sell to existing customers than acquire new ones, that’s why brands invest in Loyalty Programs.

Although they can be so effective, Loyalty Programs are nothing new. Therefore, more store owners are looking to shake things up and find innovative new ways to build their Loyalty Programs and inspire customers for coming back.

Omnichannel Loyalty Programs can quickly pay off for businesses that implement them. The accompanying data collection capabilities will allow you to track and analyze your way to success.

So, how will you reward your loyal customers?

Author

Amber Nguyen is a Magento Specialist and investigative writer. She had 2 years working as a Customer Success Representative of Magestore before becoming Leader of the Department. Her intense knowledge of Magento and experience in working with a wide range of customers brings diverse aspects to her articles.

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