Customer Loyalty Programs
Help the user design and manage loyalty programs — from strategy and structure through points/tiers/rewards mechanics, member engagement, and ROI measurement. This skill is tool-agnostic but includes platform-specific guidance for Brevo Loyalty, Smile.io, LoyaltyLion, Yotpo, Stamp.me, and custom-built solutions.
Step 1 — Gather context
Ask the user:
-
What do you need help with?
- A) Program design — creating a new loyalty program from scratch
- B) Tool selection — choosing loyalty program software
- C) Points & rewards — setting up earning rules and reward catalog
- D) Tiers / VIP — designing tier levels and progression
- E) Member engagement — increasing participation and redemption
- F) Analytics & ROI — measuring program effectiveness
- G) Integration — connecting loyalty to e-commerce, CRM, or POS
- H) Migration — switching loyalty platforms
- I) Something else — describe it
-
What type of business?
- A) E-commerce / DTC
- B) Retail (physical stores)
- C) SaaS / subscription
- D) Hospitality / restaurants
- E) B2B
- F) Multi-location / franchise
- G) Other
-
Current loyalty setup?
- A) No program yet — starting from scratch
- B) Using Brevo Loyalty
- C) Using Smile.io
- D) Using LoyaltyLion
- E) Using Yotpo
- F) Using a custom-built solution
- G) Using another platform
- H) Have a basic program (punch card, discount codes) but want to upgrade
If the user's request already provides most of this context, skip directly to the relevant step. Lead with your best-effort answer using reasonable assumptions (stated explicitly), then ask only the most critical 1-2 clarifying questions at the end.
Step 2 — Strategy and approach
Loyalty program types
| Type | How it works | Best for | Example |
|---|
| Points | Earn points on purchases, redeem for rewards | E-commerce, retail | 1 point per $1 spent, 100 points = $5 off |
| Tiered | Higher tiers unlock better perks | Brands wanting aspirational status | Silver → Gold → Platinum with increasing benefits |
| Paid / VIP | Pay for membership with exclusive benefits | Premium brands, Amazon Prime model | $99/year for free shipping + early access |
| Cashback | Earn store credit on purchases | Price-sensitive customers | 5% back on every purchase |
| Punch card | Buy X, get 1 free | Cafes, salons, simple retail | Buy 10 coffees, get 1 free |
| Experiential | Rewards are experiences, not discounts | Luxury brands | Early access, exclusive events, personal styling |
Program design framework
- Define the objective — retention, AOV increase, purchase frequency, referrals, data collection?
- Choose the model — points, tiers, paid, hybrid?
- Set earning rules — how do customers earn? (purchases, reviews, referrals, social shares, birthdays)
- Design rewards — what can they redeem? (discounts, free products, free shipping, exclusive access, charity donations)
- Create tiers (optional) — 2-4 tiers with clear progression and meaningful benefits at each level
- Plan communication — welcome email, points reminders, tier upgrade notifications, expiry warnings
- Measure — enrollment rate, active rate, redemption rate, incremental revenue
Points economy design
Earning rules (typical):
- Purchase: 1 point per $1 spent (or 10 points per $1 for psychological effect)
- Account creation: 50-100 points (one-time)
- Birthday: 50-200 points (annual)
- Product review: 25-50 points
- Social share/follow: 10-25 points
- Referral: 100-500 points
Redemption value:
- Target 5-10% effective discount rate (e.g., 100 points = $5 on a program where you earn 1 point/$1)
- Don't make rewards too hard to reach — first reward should be achievable in 2-3 purchases
- Offer a mix of reward values ($5, $10, $25, free product, free shipping)
Tier design
- 2-3 tiers is ideal — more than 4 creates confusion
- Name tiers — use brand-relevant names, not just Bronze/Silver/Gold
- Clear progression — spend $X/year or earn X points to reach next tier
- Meaningful benefits — each tier must feel noticeably better (not just 1% more discount)
- Maintain status — require annual re-qualification to maintain tier (prevents dormant high-tier members)
Step 3 — Platform-specific guidance
In Brevo
- Product: Brevo Loyalty — full loyalty engine with points, tiers, rewards, vouchers, mobile wallet
- Key concepts: Programs, Subscriptions (enrolled members), Balances (points), Tiers, Rewards, Vouchers
- API: Comprehensive REST API for all loyalty operations — program management, subscription enrollment, balance transactions, tier assignment, voucher creation/redemption
- Mobile wallet: Digital loyalty cards on Apple Wallet / Google Pay (Enterprise only)
- Strength: Integrated with Brevo's email/SMS/WhatsApp — loyalty events can trigger marketing automation (e.g., tier upgrade → congratulations email, points expiring → reminder SMS)
- Limitation: Enterprise plan only — not available on Starter/Standard/Professional
- Best for: Teams already using Brevo for marketing who want integrated loyalty without a separate tool
- Platform skill:
In Smile.io
- Product: Popular loyalty platform for Shopify, BigCommerce, Wix
- Programs: Points, VIP tiers, referrals — all in one
- Free tier: Up to 200 monthly orders
- Strength: Best Shopify integration. Easy setup, good-looking widget. Strong referral program built in.
- Limitation: Limited customization on lower plans. Advanced analytics on higher tiers only.
- Best for: Shopify stores wanting a quick, attractive loyalty program
In LoyaltyLion
- Product: E-commerce loyalty platform with deep analytics
- Programs: Points, tiers, custom rewards, loyalty pages
- Strength: Advanced analytics and segmentation. Can create custom loyalty pages. Good for data-driven teams.
- Limitation: Higher starting price. Setup is more complex.
- Best for: Mid-market e-commerce brands wanting detailed loyalty analytics
In Yotpo
- Product: Part of Yotpo's retention marketing suite (loyalty + reviews + SMS + email)
- Programs: Points, tiers, referrals, VIP
- Strength: Combines loyalty with reviews and UGC — customers earn points for reviews, which generates social proof. Unified retention platform.
- Limitation: Most powerful as a suite — loyalty alone may be expensive. Complex pricing.
- Best for: E-commerce brands wanting loyalty + reviews + SMS in one platform
In Stamp.me
- Product: Digital loyalty card and stamp program
- Programs: Digital punch cards, points, tiered rewards
- Strength: Simple and affordable. Mobile-first with digital stamp cards. Good for brick-and-mortar.
- Limitation: Less sophisticated than full loyalty platforms. Limited e-commerce integrations.
- Best for: Cafes, restaurants, salons, and small retail with simple loyalty needs
Custom-built
- When: Unique business model, specific integration needs, or very high volume (millions of members)
- Approach: Build on your database + API layer, or use headless loyalty APIs
- Strength: Complete control and customization
- Limitation: Significant development effort, ongoing maintenance
- Best for: Enterprise with unique requirements or companies where loyalty is a core competitive advantage
Step 4 — Actionable guidance
Launch checklist
- Design program — model, earning rules, rewards, tiers (see Step 2)
- Choose platform — based on your e-commerce stack and needs
- Configure — set up program, earning rules, reward catalog, tiers
- Design assets — loyalty page, widget, emails (welcome, points earned, reward available, expiry warning)
- Set up automations — trigger emails/SMS based on loyalty events
- Soft launch — test with a small group, verify points earning and redemption
- Promote — announce via email, site banner, checkout page, social media
- Measure — track enrollment, engagement, and revenue impact weekly
Key metrics
| Metric | Benchmark | What it tells you |
|---|
| Enrollment rate | 20-40% of customers | Program attractiveness |
| Active member rate | 40-60% of enrolled | Ongoing engagement |
| Redemption rate | 20-40% of points issued | Reward appeal |
| Member vs non-member AOV | 15-25% higher | Revenue impact |
| Member purchase frequency | 20-40% higher | Retention impact |
| Program ROI | 3-5x cost | Overall program value |
Gotchas
- Don't make the first reward unreachable — if it takes 10 purchases to earn the first reward, most customers will give up. Design the first reward to be achievable in 2-3 purchases.
- Don't create too many tiers — 2-3 tiers with meaningful differences beats 5 tiers with marginal distinctions. Each tier should feel like a real upgrade.
- Don't forget expiration communication — if points expire, you must warn members before expiration (30 days, 7 days, 1 day). Surprise expiration creates angry customers.
- Don't discount your way to losses — if your effective discount rate exceeds your margin, the program loses money. Model the economics before launch (typical target: 5-10% effective discount).
- Don't neglect non-purchase engagement — the best loyalty programs reward reviews, referrals, social engagement, and account actions — not just purchases. This keeps members engaged between purchases.
Related skills
- — Brevo platform help (Brevo Loyalty setup and configuration)
- — Affiliate and referral programs with commission payouts
- — Email communication for loyalty program members
- — Checkout optimization (loyalty display at checkout)
- — Connect loyalty tools with e-commerce and CRM
- — Not sure which skill to use? The router matches any sales objective to the right skill. Install:
npx skills add sales-skills/sales --skills sales-do
Examples
Example 1: Designing a loyalty program for a Shopify store
User says: "I run a DTC skincare brand on Shopify with $80 AOV. How should I structure a loyalty program?"
Skill does: Recommends points-based program with 2 tiers. Earning: 1 point/$1 + bonus points for reviews and referrals. Rewards: $5 off (50 points), $15 off (150 points), free mini product (100 points). Tiers: Regular + VIP (spend $500/year for 1.5x points, free shipping, early access). Recommends Smile.io for Shopify.
Result: Complete program design with economics, platform recommendation, and launch plan
Example 2: Measuring loyalty program ROI
User says: "Our loyalty program has been running for 6 months and we're not sure if it's working"
Skill does: Defines key metrics to pull (member vs non-member AOV, purchase frequency, retention rate, redemption rate). Provides benchmark comparisons. Identifies common issues (low engagement, unreachable rewards, no communication).
Result: Measurement framework with specific metrics, benchmarks, and optimization recommendations
Example 3: Setting up Brevo Loyalty with email automation
User says: "We're on Brevo Enterprise and want to launch a tiered loyalty program with automated emails"
Skill does: Walks through creating a loyalty program in Brevo → defining tiers and earning rules → setting up reward catalog → building automation journeys triggered by loyalty events (enrollment → welcome, tier upgrade → congratulations, points expiring → reminder)
Result: Loyalty program configured in Brevo with automated email flows for all key moments
Troubleshooting
Low enrollment rate
Symptom: Less than 10% of customers joining the loyalty program
Cause: Program not visible enough, value proposition unclear, or signup process too complex
Solution: 1) Add loyalty callout on homepage, product pages, and checkout. 2) Offer sign-up bonus (50-100 points). 3) Simplify enrollment to 1 click (email only). 4) Show the first achievable reward at signup ("You're 2 purchases away from $5 off!").
Members not redeeming rewards
Symptom: High points issuance but low redemption (< 15%)
Cause: Rewards not appealing, redemption process too complex, or members forget they have points
Solution: 1) Survey members on desired rewards. 2) Simplify redemption (1-click at checkout). 3) Send points balance reminders monthly. 4) Add lower-tier rewards that are easier to reach. 5) Show points balance prominently on account page and in emails.
Program losing money
Symptom: Loyalty program costs exceed the incremental revenue it generates
Cause: Effective discount rate too high, or program attracts deal-seekers without increasing loyalty
Solution: 1) Calculate effective discount rate (total rewards redeemed ÷ total member revenue). 2) If > 10%, reduce earning rate or increase redemption thresholds. 3) Add non-discount rewards (early access, exclusive content). 4) Implement minimum spend for redemption. 5) Segment: compare member lifetime value to non-member — if no difference, the program isn't driving incremental behavior.