How to Create an Effective Omnichannel Loyalty Program in 2024?

With 72% of customers saying they feel loyalty toward at least one brand, creating a rewards program to foster a genuine relationship with your customers seems like a key element of your business strategy. But while designing and implementing a loyalty program is one thing, getting it across to your audience is another, and one that often gets overlooked.

The market is changing rapidly, just like consumers’ needs, behaviors, and preferences. In today’s commerce landscape, having one channel of reaching customers with your offer is not enough. What is the way to go, then? Creating a cohesive experience that involves multiple channels.

In this article, I will elaborate on what omnichannel loyalty is and what channels you can use for it. I will also explain the benefits and challenges of omnichannel loyalty programs and show some real-life campaign examples. 

Is multichannel and omnichannel the same thing?

Although multichannel and omnichannel may look like synonyms, there is a slight but crucial difference between these concepts. Multichannel communication also involves multiple touchpoints and channels, but each of them follows a different strategy, and the service is not consistent and coordinated. 

On the other hand, in omnichannel commerce, all the available channels are coherently integrated and provide a seamless experience no matter which channel (or channels) a customer chooses to use. This means a consistent brand voice and quality offered to customers, which in turn creates a reliable image of your business.

What is an omnichannel loyalty program?

An omnichannel loyalty program is a rewards scheme based on a combination of various channels of communication and points of sale. In the omnichannel approach to loyalty programs, members can collect points and redeem rewards in a variety of complementary ways. 

Basically, this may mean that your loyalty program is available and workable in your physical stores, online stores, and via app. Omnichannel communication related to loyalty programs includes both advertising the program and notifying its existing members about the latest updates.

What’s important, according to Forbes, “omnichannel” is no longer just a fancy buzzword: in fact, nowadays, customers simply expect omnichannel experience as a default setting of their shopping activities. And 90% of customers expect this omnichannel experience to be fully consistent across all the channels. That’s a fact that you need to take into account while creating your loyalty campaign.

How do omnichannel loyalty programs differ from traditional ones?

Omnichannel loyalty programs use modern technologies to leverage their possibilities in providing the best experience to loyalty members. Hence, customers may participate in a rewards program through the channels of their choice and the brand is able to communicate with its audience across these channels, be it an app, an email, or another point of contact.

In contrast, the traditional approach to customer loyalty would involve a single channel only, such as a website or, even more frequently, offline ways of communicating with the customer and handling the point collection and reward redemption process. This resulted in a number of limitations on how customers participated in the program and how the brand reached out to them.

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What channels can be used for loyalty programs?

In its most basic form, an omnichannel loyalty program will combine three primary channels: offline, ecommerce, and mobile. This means that your loyalty program should be accessible in-store, through your website or a dedicated landing page, and by means of a mobile application. 

What’s more, the program should provide the same experience in all the channels, although you may of course decide that the use of a particular channel will yield specific benefits and incentives that are not available on other channels.

Depending on the objectives of your loyalty program, the nature of your business, and the characteristics of your target group, you can choose which channels to include in your campaign. This choice should always align with the shopping habits and preferences of your customer base so that they feel strongly encouraged to join and engage with your loyalty program.

The omnichannel quality of a loyalty program refers to various aspects of how it operates. 

First of all, you may choose to provide several channels which will serve as customer cockpits: spaces where customers can sign up to collect their points, check their number, redeem rewards, and perform other actions related to the program participation. The basic examples of such channels are:

1. Website

This is one of the most common solutions that customers and brands naturally reach for when it comes to loyalty programs: you can create a separate section on your website that will take a customer to their loyalty program dashboard or simply include it in the customer account next to other order-related sections.

2. Mobile app

‍Apps are extremely popular these days as they make for an easy solution: the customer simply needs to grab their smartphone, open an app, check the point balance, available rewards, and expiration dates, and track their tier progress and milestones with one or two swipes.

3. Digital wallet

‍A mobile wallet is an electronic platform where users can store and manage their digital loyalty cards, coupon discounts, gift vouchers, and rewards. A digital wallet is like a supercharged version of a loyalty app which resembles a physical wallet and thus makes for a useful and handy tool that provides an overview of all the customer’s incentives in one place.

Omnichannel loyalty communication channels overview

Another essential function of omnichannel loyalty programs is communication between the brand and the customers. These are the channels that can be successfully applied for communication purposes:

• Mobile app or digital wallet: These two channels, also mentioned above, have a practical use in terms of communication as well. They are good tools that ensure proper and effective communication distribution – you can use them to convey personalized and real-time messages to your customers and let them know about any updates connected with the loyalty program.
• SMS: Text messages are definitely not a thing of the past. Texting is an effective way to engage with customers and keep them updated on the loyalty program offers and rewards. Here, you can also send personalized messages directly to your customers' phones.
• Emails and newsletters: What can be a more straightforward and direct method of communicating with your loyalty program members than email? You can use this channel to communicate virtually anything to your customers by sending personalized and profile-based messages as well as notifications about exclusive contests, giveaways, and special offers only available to loyalty members.
• Social media: Social media platforms may not be the best place for sending personalized messages and offers, but they are absolutely great if you want to communicate with your audience on a large scale and send some general announcements and news about your loyalty program. Hence, they are also very useful for acquiring new customers by informing them about the benefits of participating in your program.

All of the examples listed above are digital means of communication. But omnichannel means that your loyalty program can combine online and offline channels. Actually, this is where the key to success lies: by embracing both online and offline channels, you make sure your program is inclusive and can be used by diverse audiences. Here are some ideas for non-digital channels:

• Stamp or punch cards: This traditional solution is great for the offline version of your loyalty program, still much enjoyed by many customers. There is a certain pleasure in collecting stamps on a pretty loyalty card, isn’t there? Make sure, however, that the points gathered on the physical card are synchronized with the online customer cockpit so that they can check their credit online whenever they want.
• In-store communication: Let’s not underestimate the power of face-to-face conversations. If your business is also based on brick-and-mortar locations, make use of their potential. The store staff can talk to customers to inform them about the loyalty program, its benefits, and terms and conditions, they can advise on how to earn points and redeem rewards, and they can help shoppers if they have some problems with their online accounts (although of course, we hope they won’t have any problems). 
• Direct mail: Although snail mail has become a much less common ecommerce channel in the digital age, it can still be used effectively for loyalty programs. You can use traditional mail to send personalized offers as well as physical loyalty cards, rewards, and coupons to your customers’ physical addresses: obviously, upon their consent.

What are the benefits of omnichannel loyalty programs?

If you’re asking yourself what the benefits of designing and implementing an omnichannel loyalty program actually are, here we come. The key wins of loyalty programs that are integrated across various channels include:

1. Enhanced user experience

Omnichannel loyalty programs offer a seamless and consistent experience across various channels. As customers can engage with the program through their preferred channels, the experience feels more convenient and inviting. As a result, this cohesive approach boosts their loyalty, satisfaction, and engagement – and retention rates grow.

For example, customers can earn points while shopping in-store, and later see them in their account on the website and in the app. Then, they can redeem their rewards in the online or physical store. This ensures smooth transition from one touchpoint to another.

2. Larger reach

A typical customer does not exist. Your brand is surely addressed to a certain target group, but even within your audience, there will be individual differences and nuances. This is why creating an omnichannel loyalty program is like reaching out a hand to particular consumers with their specific needs, habits, and capabilities. 

For instance, some customers hate receiving text messages from shops, while others prefer to engage with brands on social media, and there is still a mighty group of customers who rely on non-digital channels and prefer to complete their purchases in physical stores. You will make them happy and appreciated by offering flexible opportunities for your loyalty program.

3. Better communication

Omnichannel distribution provides you with a myriad of ways of communicating with your customers as part of your loyalty program. You can reach out to them and send status updates through their customer profiles, the loyalty app of your program, messaging channels, website in-built communicators, live chatboxes, push notifications, web widgets, email, social media, and traditional mail.

This, again, enhances user experience, allows you to gather information about customer preferences, and streamlines the whole loyalty process. Make sure you adjust the frequency of your communication across these channels to send only relevant information and avoid spamming.

4. Better personalization 

Omnichannel loyalty programs give plenty of room for customization. You can use various channels to deliver personalized offers, recommendations, and rewards based on individual preferences and behaviors. 

This targeted approach enhances relevance and increases the likelihood of customer engagement and conversion. Basing the program of direct-to-consumer channels such as email, SMS, or social media will foster the bond between the loyalty member and the brand, increasing loyalty.

5. Data-driven insights

The more channels you offer to your loyalty members, the more data you are able to gather about their preferences. Thanks to the cross-channel tracking of customer activity, interactions, and feedback, you can make better and more informed decisions on how to grow your business and develop the loyalty program. 

The comprehensive insights you get through the holistic omnichannel approach are a valuable resource for analysis that can refine your marketing strategies and optimize the overall customer experience.

6. Increased profits

Omnichannel loyalty programs are here to increase your revenue and profitability. By driving customer retention, repeat purchases, and higher engagement levels, you will generate more sales. 

There’s more to this: personalizing offers and promotions based on the gathered omnichannel loyalty customer data can lead to more effective marketing campaigns and higher conversion rates. Also, a well-crafted omnichannel loyalty program can grant you a competitive edge and differentiate your businesses from competitors the competition to attract and retain customers more efficiently.

What are the challenges of creating an omnichannel loyalty program?

Omnichannel loyalty programs bring numerous benefits to businesses they can also be a complex endeavour that comes with some challenges and difficulties. Here are some of the key ones to consider:

• Data integration: Integrating customer data from various sources, channels, and touchpoints, both online and offline, and ensuring data accuracy, consistency, and privacy across various systems can be challenging – but not undoable.
• Technology infrastructure: Implementing an omnichannel loyalty program usually requires integrating multiple technologies, such as CRM systems, mobile apps, e-commerce platforms, and in-store POS systems. 
• Managing various channels: Providing a consistent experience across different channels involves aligning several parallel processes to ensure that customers earn and redeem rewards trouble-free regardless of the channel. 
• Measuring success: Measuring the performance and effectiveness of an omnichannel loyalty program and determining the right KPIs can be challenging, too, as traditional metrics like customer acquisition and retention rates may need to be reevaluated to capture the actual impact of the program. 

Despite these challenges, an effectively executed omnichannel loyalty program has the potential to make the best of its benefits, such as deepening customer engagement, fostering brand loyalty, and driving business growth. However, it requires careful planning and the use of the right technology.

How do brands create successful omnichannel loyalty programs?

Here are several examples of how top brands implement good omnichannel loyalty practices.

1. Burger King

Burger King’s Royal Perks rewards program is a model example of how to approach omnichannel promotions in terms of loyalty. The omnichannel quality is visible in various aspects of the program. 

• Customers can join either by signing up on the mobile app or by filling out a form on the website. The app and the site both have the same design and provide the same experience and information. 
• Members are able to redeem rewards on the website, via app, or in the restaurants. For example, they can upload the bills to the online system to collect points and use them at the participating restaurants by telling their loyalty card code to the sales assistant.

The program is complex in structure but easy to use and understand for customers, who can benefit from the power of omnichannel by combining the online and offline experience.

2. Starbucks

My Starbucks Rewards is one of the most successful and widely recognized loyalty programs called. 

• It is accessible through the mobile app, allowing customers to earn Stars for purchases made in-store or through the website. At the physical locations, the receipt can be scanned into the mobile app.
• Customers can also use the app to pay for the order with their digital Starbucks Card. Plastic cards are available as well. Members can also combine various cards they own to accumulate the balance.
• Customers can choose to redeem their rewards when ordering ahead using the mobile app or show it to the cashier at their local Starbucks cafe. 
• What’s more, the program incorporates personalized offers and the ability to earn rewards at partner locations. Mobile pre-ordering enables customers to grab their orders fast, without waiting in line.

The example of Starbucks shows how to skilfully combine the offline and online experience as a coffee house.

3. Sephora

Sephora’s Beauty Insider omnichannel loyalty program offers a tiered system of rewards based on customers’ spending levels. 

• Members can earn points for purchases made in-store, online, or through the Sephora app. 
• They receive personalized product recommendations, exclusive event invitations, and special offers through various channels.
• When a customer enters a Sephora store, they can use the app to view a map showing in-store deals tailored to their preferences.

4. H&M

H&M’s loyalty program is always presented as an example of the best loyalty practices in practically every aspect, including the omnichannel approach.

• Customers get points on all their purchases in-store and online. To earn points in-store, they must scan the member ID via the H&M app. 
• In the program dashboard, members can find all their digital receipts from in-store and online purchases within 45 minutes. Customers receive updated information about their current offers and rewards on their account page in the H&M app or on the brand’s website. 
• The brand communicates with users omnichannel to grant them special offers, rewards, and event invitations.
  

5. North Face

The XPLR Pass loyalty program designed by this outdoor brand literally allows customers to mix their offline/outdoor and online/indoor activities for a better shopping – and exploring – experience.

• The program can be joined through the brand’s app or website or by in-store sign-up. The app and the website are also where customers can check their credit balance.
• Members get points for purchases made online and in-store as well as for various sustainable actions taken in the non-digital world, such as visiting national parks and checking in there through the app. Checking in via app at one of the North Face stores also gives points.
• Rewards can be redeemed at North Face-owned stores, outlets, or online. The reward contains a card number and a PIN that are necessary for the redemption, both online and in-store.
• North Face uses email and the app to communicate with the loyalty members about exclusive offers, events, deals, and access to tests of unreleased products.

6. Pomelo

Pomelo is an online fast fashion brand and marketplace targeted at customers from Asia. The brand has created an omnichannel loyalty program called Pomelo.Perks. 

• Pomelo offers a unified incentive experience for every customer touchpoint, including email, mobile apps, and web, based on cross-channel distribution and communication.
• Members earn and apply cashback on all Pomelo purchases, including in-app, on the website, and in-store.

7. Yves Rocher

The French cosmetic brand Yves Rocher with branches across the world. Their tiered loyalty program is another great example of the omnichannel approach.

• Customers can shop online and in-store using a physical loyalty stamp card which is synchronized and integrated with earning points online – if a customer has a physical card already and opens an account, the points are added up.
• Rewards can also be redeemed in-store and through online orders.
• Loyalty customers receive exclusive offers by email, SMS, and traditional mail.

The YR program shows how to effectively address both digital and non-digital audiences.

How to build an omnichannel loyalty program with Voucherify?

Omnichannel loyalty programs involve much more than just multiple platforms for viewing customers’ points and rewards. Consumers expect loyalty programs to align with all the aspects of their shopping experience. To meet these needs, you need a customizable tool that allows the combination of various channels and levels in an easy-to-use way.

Voucherify is a loyalty engine where you can build a complex loyalty campaign from scratch and base it on the omnichannel distribution and marketing approach. 

Voucherify aids you in designing the most efficient omnichannel loyalty program possible as it’s an API-first tool. Its robust and adaptable API-based mechanism, webhooks, and SDKs make it possible to build a composable and headless omnichannel loyalty program addressing particular use cases and business objectives.

As you can integrate our backend with your frontend, you get numerous opportunities to adapt messaging to your own branding. For example, for sign up, you can connect your form design with our API, or alternatively use the available landing pages and message editor. 

Our loyalty software can trigger automated and personalized, event- and geo-based messages which reward your customers’ desired behavior via any marketing channel.

Voucherify’s customizable digital wallets use API to send all customers’ incentives to a single space, it can communicate with any mobile app, and you can connect it with your marketing stack to gather the customer’s incentives, campaigns, and loyalty score across all channels.

Thanks to the out-of-the-box solution and technology integrations with a number of top marketing, ecommerce, messaging, CRM, CDP, and CMS partners, creating an omnichannel loyalty experience is time- and cost-effective.

Learn more: Explore Voucherify's Open Source Loyalty Accelerator

Summary

Omnichannel loyalty programs are a tailored response to the omnichannel reality of today's consumers, who often jump between devices and touchpoints during their buying journey. Such programs are a great way to engage your customers wherever they choose to interact with your brand. 

By connecting various commerce and communication channels, you are able to provide a cohesive loyalty experience, which ultimately drives customer loyalty, repeat purchases, and brand advocacy. In order to successfully bridge the gap between the channels, you need careful planning, harmonious integration of systems and data, a deep understanding of customer behaviors, and the right software to make the omnichannel experience come real.

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