Many shops switch on loyalty points, and three months later the list shows a few hundred customers with points but only a handful who have ever redeemed a reward. Earning points still works; what usually breaks is the redemption side: the rewards are not appealing enough, customers do not know they are close to a reward, or redeeming at the counter is clumsy so staff avoid mentioning it. How to set the earning rate and redemption threshold is covered in loyalty cards for your shop: setting the numbers so you still make a profit. This article covers the rest: choosing rewards, setting them up so the cashier does not calculate by hand, introducing the programme at the counter, and measuring whether customers really take part.
Choosing rewards: worth it to customers, cheap for the shop
A good reward is something customers value more than what the shop actually spends on it. Four common kinds of reward:
| Type of reward | What customers see | What the shop really spends |
|---|---|---|
| A best-selling item: a coffee, a fruit plate | Exactly what they usually order | The item's cost, lower than its selling price |
| A new or less popular item | A chance to try something new | The item's cost, and maybe a future sale of that item |
| Money off the bill | Clear and easy to understand | Exactly the amount discounted |
| Physical gifts: tumblers, tote bags | Nice-looking, something to take home | Cost of the gifts, storage space, separate counting |
Small shops should start with items on the menu. Physical gifts look nice but have to be bought and counted separately; if they run out halfway, customers who saved enough points get no reward, which hurts trust more than having no programme at all. Two or three tiers are enough: a small tier within a few visits so new customers feel it is close, and a bigger tier for regulars. With six or seven tiers the cashier cannot remember them and customers will not read them all.
Set rewards up in the software so the cashier does not calculate by hand
If redeeming means the cashier has to flip through a notebook and use a calculator to check whether a customer has enough points, nobody will bring it up at busy times. Let the software handle it:
- Money-to-points rate. For example, 1 point for every 10,000 VND the customer pays. Points are added automatically at payment.
- Each tier is one line. Tier name, points required, and the benefit: a fixed amount off or a percentage off.
- If the reward is an item, set the discount equal to that item's price. The customer orders the item, redeems points, and the bill drops by exactly the item's price. No need to add a separate "free item" to the menu.
At payment, as soon as the cashier selects the customer they see the tier and remaining points. If there are enough points, the software deducts them and applies the discount to the bill; if not, it shows that there are not enough points, so there is nothing to argue about. Customers who want to save up for a bigger tier simply do not redeem that time, and their points are kept.
Introducing the programme at the counter
However good the programme is, if nobody mentions it customers forget. Three moments to say something, one sentence each:
- When first asking for a phone number: "Leave your number to collect points, 50 points gets you a free drink." Name the actual reward, do not just say "we have points". For how to ask so customers are happy to share, see asking for customers' phone numbers at checkout.
- At every payment: tell them their points and how far they are from a reward. "You have 42 points, one more visit and you can redeem."
- When the customer has enough points: ask whether they want to redeem now or save up; do not redeem on their behalf.
Add a small sign at the counter or a line at the bottom of the menu listing the rewards and points needed. If customers can read it, staff have less to explain.
Measuring whether customers really take part
Three numbers each month are enough to tell whether the programme is alive or dead:
- Number of new customers leaving a phone number. If it is low, the problem is at the counter, not with the rewards.
- Number of redemptions. Each redemption is saved in the customer's points usage history: points, tier redeemed, amount converted, redemption date, points remaining. If many customers have enough points but few redeem, the rewards are not appealing yet; change the rewards before lowering the threshold.
- Whether customers who redeemed come back. Look at those customers' last transaction after a month or two. If they redeem and then disappear, the reward is paying for a visit they were going to make anyway.
How Ordersys helps
Ordersys CRM software stores customers by phone number, adds points right at payment at the rate the shop sets, lets you set up reward tiers as money off or percentage off, and shows the cashier the customer's remaining points right on the sales screen. Each customer's points usage history, along with visit frequency and returning-customer figures, tells the shop whether the programme is keeping customers. You can try it free for 7 days.
Ordersys has editions for restaurants and for retail stores: checkout, stock, reports and e-invoices, with on-site setup and training.
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