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Easy 10 Step

Guide to Creating
Your First
Loyalty Program

Putting together a successful loyalty program may look as difficult as sending

men to Mars. Actually, its not. While reaching Mars is still decades away
and the flight path is paved with difficulties nearly impossible to anticipate,
planning a loyalty program is more like sending people to the Low Earth
Orbit of an International Space Station: it requires hard work but it is fairly

Back to Earth, as a starter, all you need to start planning a loyalty program is
a clear vision of your business objectives. Is your aim to get more customer
love? To have more fun while deepening customer relations? Is it to get
more frequent purchases? Or do you need 360-degree customer profiling?
In this ebook we will guide you through the ten most important actionable
steps from start to finish.

Zsuzsa Kecsmar,
CMO and co-founder of Antavo

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I. Define Customer Activities That Matter To You

II. Find Rewards That Excite
III. Define Your System
IV. Communicate Clearly
V. Make Your Loyalty Program Part of Your Branding
VI. Keep Your Budget Under Control
VII. Promote Your Loyalty Program
VIII. Train and Maintain
IX. Integrate
X. Test It Out

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I. Define Customer Activities That Matter To You

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I. Define Customer Activities That Matter To You

Sure, buying is your preferred customer activity, but dont be grasping. Think about all the
positive behavioral patterns that can lead to an actual purchase. By finding these, you will able
to tell what the pressure points are, which actions you need to reward in order to push your
customers through the purchasing funnel. We recommend you to stick with the following

The actions you choose should be in harmony with your business goals. For example, if your
goal is to have more customer love, you should reward actions that result in more customer
love. Its that simple. Let customers get to know your story, read about your mission, and look
at some behind-the-scenes videos.

The actions should be trackable. While it would be an awesome result, you cant really reward
actions like think about us three times a day with love. These types of actions are not track-
able. On the other hand, reviews written, new visitors gained from shared links, customer
profiles completed - these are all measurable actions that you should concentrate on.

The actions should represent all of your channels. Dont think just about website clicks.
Instead, come up with a selection of customer actions from all your marketing channels: websites,
webstores, social media sites, apps, etc., are all in the game!

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I. Define Customer Activities That Matter To You

Tip: In our ebook titled 7 Customer Activities To Reward you can find a plethora of specific examples about
customer actions worth rewarding, the thinking behind why it is beneficial to do so, and how you can transform
these actions into activities that fit your loyalty program.


In your store On your homepage On social channels On your Loyalty hub In emails

Purchase Video views Social profile links Content download Sign-up

Review Homepare return Shares and invites Personal information Open
Basket value Content quiz Customer referrals Subpage visit Click-through

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II. Find Rewards That Excite

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II. Find Rewards That Excite

Rewards the prize the customer eventually gets for participating are at the core of your
loyalty program. They can make or break your deal, keep your customers engaged or drive them
away. There are a few main points that you should think about while selecting them:

The rewards themselves: virtual badges, physical or downloadable goods, coupons, etc.

Logistics: how your customers get their rewards. Do you have to ship them? If yes, how will
you deliver them? Are they downloadable? If so, is your back-office infrastructure ready to
handle the load?

Value: Do you have a sufficient budget? Are the rewards sitting in your warehouse or do you
have to purchase them? Theres a huge difference between simply doling out excess items
and producing unique, personalized items that cant otherwise be obtained.

Special experiences: The rewards that really make your customers move are special and
extreme events, experiences they cant have any other way. These are also great on your side
because they can make strong emotional bonds with your brand.

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II. Find Rewards That Excite

Personalized goods: Adding personalization to the mix also adds a new level of engagement.
Think about rewards in your customers favourite colors or goodies from their personal hero.

Fun stuff: This can help you build really strong social ties and convey an insider feeling but
still make your customers smile.

Tip: In the ebook Top-Notch Rewards - World Class Results we go into great detail about how
to find the perfect rewards.


Psychical Virtual Coupons Downloadable Sweepstakes

goods badges goods

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III. Define Your System

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III. Define Your System

Just simply giving away your rewards doesnt sound like a good idea; instead, you should set up
a system of loyalty points that can be translated into exchanged for rewards later. Important

How many loyalty points can be earned by completing each activity? More on this in our
ebook 7 Customer Activities to Reward.

What is the exchange rate? In other words: what reward can a customer get for a given
number of loyalty points? We discuss this issue in detail here:
Top-Notch Rewards - World Class Results

How do you plan to bring in the fun? These can be levels of achievements that can be earned
automatically for a given number of loyalty points collected. Try to come up with amusing
names your customers can identify with, names that give them a feeling of insiderness. For
example, in a bodybuilding webstore, level names can be Pocket-Terminator, Too Big To
Fall, or Hardcore Scientist.

Tip: To plan the various achievement levels, first sum up all the loyalty points that can be earned
by completing every single activity. Lets say, its 5000. Then divide this number by the number
of levels you plan to implement. We usually recommend 10. So far, we have 10 levels with 500
loyalty points each.

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III. Define Your System

Now, give the levels different weights. The point of this is that starting out needs to be easy to
keep your customers engaged but later accomplishments should get harder level-by-level to
balance it with challenges. See this example from the field of informatics:

Level Points needed

Newbie user: 0-150
Rookie tinkerer: -500
Skilled contributor: -1000
Seasoned administrator: -1500
Experienced programmer: -2500
Advanced engineer: -3000
Senior developer: -4000
Expert webmaster: -5000

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IV. Communicate Clearly

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IV. Communicate Clearly

After you have stitched together the various parts of your loyalty program comes the next step:
how to tell the world about it. Will your customers know what to do in order to participate?
Once in, will they know what tasks to do? How do you tell them about the rewards? Will they
have a clear picture of how to exchange their loyalty points for rewards? These are all important
questions, so there is a lot to explain to your customers. Here are some sure-fire ways to do so:

About page: a dedicated micro-site where you can give detailed explanations and highlight the most
important information.

Video: where the face of your brand explains the ins and outs of your loyalty program with
motions, sound, and action.

Infographics: lots of visuals, leaner textual content supported by pictographs and icons
think about it as a flowchart of your program.

News article: it can be a blog post or an item from your news section.

Tip: We have dedicated a whole ebook full of ideas to the communication of loyalty programs:
How to Promote Your Loyalty Program. Also, notice that software solutions like Antavos
automatically generate a neat microsite.

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IV. Communicate Clearly

Your customer should have a clear picture of your loyalty program. The three most important
things you should explain:

1. Why it is worth opting in.

2. How they can earn loyalty points.
3. The rewards they can get.

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V. Make Your Loyalty Program Part of Your Branding

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V. Make Your Loyalty Program Part of Your Branding

A successful loyalty program doesnt just fit nicely into your branding efforts it should strengthen
your brands essence! There are some key points to watch out for:

Visuals. Think colors, images, and typography. Additionally, its usually worth spicing up your
existing visual standards by implementing one-of-a-kind, interesting and fun elements to
convey excitement that make your customers say: Wow.

Wording. You probably have a clear idea about the voice and tone that resonate with your
customers. Its advisable to carry on with the same to make the whole loyalty program more
familiar to them, giving a boost to their engagement.

Advertisement. You should use your visuals and voice consistently across all the outposts
where your customers can see your promotions. Make the top rewards a centerpiece of your
advertising campaign while emphasizing the various benefits for customers who participate.

Tip: To have a smooth landing with your loyalty program branding issues, its worth getting help
from a professional designer. At Antavo we help you by providing basic templates and visuals
that you can later edit to your liking via a HTML and CSS editor. When picturing rewards, you
should take great care to represent them in the best possible way.

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V. Make Your Loyalty Program Part of Your Branding

Antavo provides you with templates that can be re-colored and edited to your own liking.

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VI. Keep Your Budget Under Control

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VI. Keep Your Budget Under Control

A loyalty program budget has the same business logic as any other financial plan: preparation
and cost estimation are crucial. The more exact and detailed you can get, the fewer surprises
that will await you. Here are some specifics that you shouldnt neglect:

Clear the basics. What rewards would be efficient? What kind of visuals should you use? What
marketing plan could support all this?

Research technology. Do you have what it takes to run a full-blown loyalty program? Do you
build your own solution or use one provided by a third party?

Technology costs. Hardware, software, and human resources you need technicians,
developers, programmers, administrators, etc.

Rewards costs. The cost of the goods themselves, the cost of displaying them (photography,
graphic design, etc.), and the cost of delivery.

Launching costs. Putting together all the content needed, such as newsletters, videos, ads,
plus the costs of maintaining the wave: for example ongoing advertising campaigns, contests,
follow-up emails. Find more details in this e-book.

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VI. Keep Your Budget Under Control

Tip: Virtual rewards (badges, sweepstakes and so on) are good options when facing budgetary
constraints because their production cost can be pretty low and delivering them is almost free.
Adding a full-blown software-as-a-service loyalty program management tool to the mix, like the
one we have at Antavo, can further cut your budget. We have a lot to tell you about planning your
budget in this ebook.

Furthermore, by using a full-featured loyalty management software you dont need to worry
about technology and specific loyalty marketing issues. Plus, it saves you money.

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VII. Promote Your Loyalty Program

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VII. Promote Your Loyalty Program

Its not enough to have a plan for a loyalty program. A supplemental marketing plan which, in
turn is integrated into your strategic communications plan is also needed. You should think
about the launch of a loyalty program in the same way as you prepare a new product release:
communicate, display its benefits, and keep it in constant focus. Here is the list of some great

In-store marketing gives an instant boost to spread the word and gain traction and popularity.
Basic but efficient tools include interactive banners and widgets highlighting the benefits of
taking part in your program. Although, these are mainly targeted to visitors who have yet to
opt in to your program, an additional feature can be to display the earned loyalty points to
customers already signed up, a nice feature of Antavos software as well.

Email campaigns about new and exciting rewards or prizes with limited availability, extra
bonus weekends, or reminders to customers to apply for their rewards. These strategies are great
because they create a sense of urgency and a continuous buzz. More cool tactics can be
found in our ebook here.

Advertising has similar advantages to email campaigns, plus on Facebook and AdWords you
have the option to apply remarketing techniques in order to go after users who are slipping
away. Also, you can choose to advertise to specific customer segments only, separating for
example customers not already in your program from customers already on board. Its a great
practice because wording specific messages to each of your customer segments makes their
conversion easier.

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VII. Promote Your Loyalty Program

Tip: A loyalty program management software, like Antavos, usually has the option to automati-
cally invite your customers to the game and keep them playing. For example, autoresponders
take care of reminding them to check-in from time to time or notify non-member visitors via
personalized banners to opt in so as not to miss a great opportunity. We have an ebook discussing
your various communication options in detail.

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VIII. Train and Maintain

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VIII. Train and Maintain

A set-it and forget-it attitude usually doesnt work out well when dealing with a loyalty program.
Its not enough to just launch it; you also have to nurture it. But thats far from being a problem:
its actually good news because the longer your loyalty program runs, the more chances you have
to invite your customers, and eventually grow their lifetime value. You will need the following

A colleague to take care of all the customer feedback related to your loyalty program. Its a
great opportunity to start a lot of conversations with your customers, making them more
engaged and satisfied, and eventually more loyal.

A colleague to manage activities and rewards with the responsibility of reporting and taking
action at least once a week. The aim here is to keep your customers attention as long as you
can, so you need to find time to come up with new activities and rewards options periodically.

Periodic communication. You dont want your customers to forget about your program, so
spice it up from time to time with exciting and special marketing materials, containing for
example new rewards and special double points weekends.

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VIII. Train and Maintain

Tip: Choose a loyalty management software with an actionable statistics function like we have
at Antavo. The advice you get about which rewards and activities you should turn off and what
new kinds are needed is very valuable. For example, Antavos performance score tells you about
the relation between your RFS (recency-frequency-spend) score at your webstore and the actual
loyalty program you are running. With the help of this information you can decide about intro-
ducing new customer activities. This is what you can see in the diagram below.

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IX. Integrate

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IX. Integrate

No matter how you run your loyalty campaign, be it a self-built solution created by your develop-
ers or with the help of a full-service agency or even using a SaaS (Software-as-a-Service) solution
like Antavo, one thing is for sure: you need to be prepared to handle the issues of integration.
There are a few common problems:

1. Authentication. How do you plan to handle sign-ups? Will your customers need to create
new accounts specifically for the program? Will they be able to use their webstore credentials?
Will they be able to use their social media log-ins? These are important questions and the an-
swers you give will determine how easily your customers can participate.

2. Customer event tracking. Your loyalty program should be able to follow every single change
you make in your customer database. Think about this example: you sell car seats for kids and
give a reward when someone registers the serial number of the seat they have purchased. In this
case, both your product and your customer database should be trackable by your loyalty program
software, otherwise it wont work.

3. Third party integration. Your loyalty program should be integrated with your commerce
ecosystem, namely:

Analytics. By connecting Google Analytics, Tealium, or the like you can track customer data,
demographics, device data and more.

Ads. To effectively drive traffic to your store, a loyalty software and Google Adwords, Facebook
conversion pixel and remarketing code should be able to be connected.

CRM. Channel the data you get from your loyalty program right into your CRM system to
achieve a higher level of personal communication with your customers.

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IX. Integrate

Inventory. You have to be able to track and stay current about the rewards your users have
claimed. Shipping procedures can be started automatically when a prize has been redeemed.

Newsletter. Third party email-marketing service providers should be able to receive your live
data updates in order to send out personalized offers based on your customers actual stand-
ings in your loyalty program.

Tip: We have all these features: plug-ins, APIs, SDKs, web hooks, and numerous third party
integrations which make connecting to third party services a breeze. You can save a lot of time
and money with these compared to an in-house or an outsourced project. Plus, everything is
automated: once you connect your webstore with our software, we look after all the activities you
have defined in your loyalty program plan and detect them in real-time.

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X. Test It Out

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X. Test It Out

User experience (UX) is crucial when dealing with loyalty programs. Everything should work
neatly, clearly, and consistently. Loyalty programs are about loyalty not disappointment.

Do your customers really get their loyalty points for completing a given task?
Are they able to exchange their loyalty points for rewards?
Do they have proper information about how they can claim their prizes?
Are system notifications and email alerts right and timely?
Do third party integrations really work?

You should also monitor the proper working of automated processes. For example, if your loyalty
system is connected to your CRM, check that the transferred data is truly there.

Tip: Before going live, use test user accounts. For example, at Antavo you can create five test
accounts to play with. Its crucial because you can check every function in detail to make sure
that all are working as intended.

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This concludes our proposed 10 steps to a successful

loyalty program. Its wise advice that if you have only
9 things to say, you shouldnt make up a 10th just
to sound classier. Also, if you have 11 thoughts, you
shouldnt leave out an important one just to look cool.
We are certain that its not the situation here. What
could have been left out? What could have been added?
Lets check it together.

We started with proposed ways to pick out the best

customer actions that should be rewarded. Then, we
talked about how to find the prizes best fitting to them.
Next, we discussed how to put this together in order
to create a viable points system. Our next step was to
detail the strategies you can use to show the whole
program to the world. It was natural to try to put all
these into a wider context and give some advice about
fitting your program into your overall branding efforts.
Budgetary considerations came next; promotion, main-
tenance, integration, and testing followed.

Its a full circle, a working method distilled from

several years of experience and working with hundreds of
clients. Dont take our word for it. Give it a try and test
it out in real life!

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Contact us

I hope this information has helped you to become even more confident in how to create your
loyalty program to reach your specific business goals. Dont forget... you are not alone. Get
in touch with us for further advice, support, and help with any questions or enquiries on how
loyalty programs can advance your business.

Were just an e-mail away.

Zsuzsa Kecsmar, CMO, Antavo

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