Utilizing Reward Programs for your Ecommerce Site

utilizing reward programs for your ecommerce siteSo, I like to play video games and I just recently updated my Xbox live subscription and was prompted to sign up for Xbox Rewards.  It’s a free service that allows me to gain Microsoft points, online currency that can be spent on digital items, in different ways, all of which require me to spend a lot of time on my Xbox. Now I bet you’re asking yourself “Now Jason, what does your Xbox Reward service have anything to do with my online business?”  Well, I would be happy to explain that to you after the jump.

Signing up for that rewards program got me to thinking about the concept in general.  Tons of business offer reward programs, and I would bet that you are signed up for a few yourself.  If you doubt me, take a look at your key chain and tell me how many of those little plastic cards your currently have.  I count three on mine, with my Qdoba card being the most used (I love burritos).  The point to my ramblings is this: tons of brick and mortar stores have these rewards programs as well as some big name online retailers as well, so why not your business?


Customer reward programs promote return business.  The idea of getting a discount, free item, or some other reward for my continued business to a company gives me incentive to keep buying. Also, people like to feel like they have achieved something. In the Hanover Research Report entitled Consumer Loyalty Programs, it states that “status-laden levels of membership carry significant weight and importance.”  Think about airline companies, they have different levels in their reward programs, with the highest level getting preferred treatment and priority boarding.  It makes people feel special.  So by implementing a tiered reward program with the rewards increasing as they gain in status allows your repeat customers to feel a little more special than first time customers.


Like anything else on your site you must promote your rewards program to get the attention of your customers.  You are not the only online business that has a reward program so you have to set yourself apart from your competition.  Send out emails to past customers and let them know that you are implementing a reward program and let them know why they should join. 


Another good way to promote your reward program is to list somewhere on your site exactly what your customers would get out of this program.  Make a chart or diagram that will break down exactly how your reward program would work and what exactly your customers would receive upon obtaining a certain level or point status.  I say this all the time but I’ll say it again, transparency of a business is key in operating a successful business.


So, take a look at your business model and see if there is room to add some sort of rewards program into the mix to grow your return business.  Now if you would excuse me, I have Microsoft points to get.

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