The beauty and cosmetics industry has been growing rapidly from $483B in 2020 and is expected to surpass $716B by 2025 at a compound growth rate of 4.75% annually worldwide.
This is because people now focus on self-care and prioritize their overall well-being, resulting in them buying beauty products regularly. So, if you’re a brand in the beauty and cosmetics space, generating revenue through loyalty programs can be a significant source of income.
Of course, beauty brands have been running loyalty programs for a while now. But lately, these companies have kicked things up a notch to keep up with their competitors, engage customers more, and keep them coming back for more. These rewards programs have been a game-changer for beauty brands, helping them grow faster.
Let’s explore the evolution of these programs and how you can build a loyalty program for your beauty brand.
What is a customer loyalty program for beauty and cosmetics brands?
Customer loyalty programs in the beauty and cosmetic sector are reward systems tailored to address the specific needs of the beauty industry. The beauty industry sees customers making frequent purchases but with relatively lower spending per transaction.
To tackle this challenge, beauty rewards programs are designed to keep consumers coming back for more by offering incentives and rewards while encouraging them to explore and invest in premium products.
72% of consumers said they liked brands that send free samples so that they can try the products before making a purchase.
Beauty brands have a unique approach to rewarding their customers. Instead of relying on discounts or coupons, they greatly emphasize physical gifts. For instance, a customer might receive a surprise lipstick in their order or get a sample of perfume or hair mask as a welcome bonus for reaching a higher tier. They also have a sizeable offline presence and, hence, boast various omnichannel capabilities, which help boost both offline and online engagement.
Why is a customer loyalty program essential for beauty and cosmetics brands?
Let’s take a look at why we insist beauty, cosmetics and skincare brands should focus on customer loyalty programs:
Repeat purchases
Beauty and cosmetics are products that consumers use regularly and require replenishment frequently. By offering incentives like rewards and discounts through a loyalty program, brands inspire customers to return to their favorite brands and products, boosting sales, encouraging repeat purchases for long-term relationships, and ensuring a steady revenue stream.
Customer retention
The beauty industry is highly competitive. With numerous brands popping up and vying to grab consumers’ attention, it is complex yet crucial for brands to retain customers strategically. 82% of companies agree that customer retention is cheaper than acquisition. A well-designed loyalty program can place a brand at another level and distinguish it from its competitors. Offering unique rewards, discounts, or exclusive access to products enhances brand loyalty and customer retention in the long run.
Data insights
Loyalty programs can help brands gain valuable insights into customer behavior, purchase preferences, and demographics. Brands can use this data to personalize marketing strategies and product offerings, helping them stay relevant and responsive to customer requirements.
Brand advocacy
Satisfied and loyal customers are perfect brand advocates, as they share their positive experiences with family, friends, colleagues, and followers, if any. A brand’s loyalty program can incentivize referrals and social sharing, increasing brand awareness and attracting new customers via word-of-mouth marketing.
5 examples of beauty and cosmetics brand’s loyalty programs
While there are several examples of customer loyalty programs, here are some we absolutely love:
1. Ulta Beauty – Ultamate Rewards
Ulta Beauty is a US-based beauty store chain with a fantastic loyalty program for its customers. The program has exciting features like birthday rewards, double and triple-point purchase bonuses, and loyalty tiers. You can use the Ulta Reward points like actual money, which is super flexible and convenient. But there’s a catch – the points will expire, so users must use them before that happens.
The Platinum tier is the ultimate level in the loyalty program, giving you more points for the same level of expense. Plus, with the mobile app integrated into the program, you can check your points balance and search for products using your voice for a hands-free experience.
2. Lancôme – Elite Rewards
Lancôme has an excellent loyalty program called Elite Rewards. In addition to rewards for purchases, it also rewards you for non-purchase activities. For example, you can watch videos about skincare or write a product review and earn points. This keeps you happy and engaged even when you’re not buying anything.
And there are so many rewards to choose from! You can get cool desktop backgrounds for Facebook cover photos, and everyone can find something they like. You can access exclusive rewards like beauty consultations with makeup artists if you’re a high-class spender. They also have partner rewards like Uber credits, spa gift cards, and charity donations. Finally, there’s an activity feed where you can see what others are doing in the program. It’s a great way to build a sense of community and trust.
3. Sephora – Beauty Insider
Sephora, a popular beauty retailer, has an excellent loyalty program called Beauty Insider. The program establishes a new loyalty program standard beyond a simple earn-and-burn system. It offers exciting perks like early product access, birthday rewards, and multiple tiers. Beauty
Insider has three different levels of membership. The first level has limited benefits, making spending money more appealing and reaching the VIB (Very Important Beauty Insider) level, which offers additional benefits.
The Reward Bazaar is another feature that sets Beauty Insider apart. It provides exclusive gifts and services that are only available to high-ranking members. VIP and Rouge members can redeem their points for full-size products or trial samples. Members who achieve the Rogue tier status can enjoy premium perks such as free shipping or early access to upcoming products unavailable to the general public.
4. Debenhams – Beauty Club
Despite being a well-known British clothing retailer, Debenhams offers many beauty products and a rewards program called the Beauty Club. They have a transparent points system: You’ll earn 3 points for every GBP 1 you spend. The points you earn act like real money; you can use them to pay for your purchases when checking out. In addition to your birthday present, you also get a special gift from Benefit, one of their beauty partners.
Who doesn’t love free shipping? Debenhams loves its loyal customers so much that it offers free shipping for life by just entering a code from your monthly statement. Debenhams also loves treating its customers to special in-store and online events each year where you can earn double or triple points on cosmetics purchases. This is perfect for omnichannel retailers who want to increase curiosity and participation.
5. Birchbox – Loyalty Program
Birchbox is a New York-based monthly subscription service for makeup and beauty products. Customers customize their boxes through a profile and receive 4-5 samples from new and popular brands. There is a standard membership, where every dollar spent earns one point, and free shipping is offered for orders above $50.
A $300 annual spend gets you an Ace membership, which has benefits including early access to new product samples, promotions, and events, free standard shipping on all orders, and priority customer service.
6. Love Your Body Club – The Body Shop
The Body Shop is a popular and big beauty and cosmetics brand. But that hasn’t stopped the brand from experimenting with cosmetics customer retention tactics, such as rewards programs. The Body Shop’s loyalty program, Love Your Body Club, offers points, exclusive rewards, perks, and benefits to customers, toward in-store and online shopping. Some of the perks offered are birthday discounts, in-store free makeovers, bonus points on every third visit, members-only events, etc.
One of the highlight features of this loyalty program is the element of sustainability. The brand accepts empty plastic containers via its Return Recycle Repeat Programme. Customers get to earn more points in return as well as contribute to eco-friendly practices. The brand’s loyalty program stands out because of the sustainability factor. Loyalty members don’t only get to earn rewards but also feel good about being part of the program and contributing towards environmental sustainability—a great beauty loyalty program strategy to add to your Shopify loyalty program.
7. MAC Lover Loyalty Program
One of the biggest cosmetics brands, MAC, has a loyalty program that offers multiple ways to earn points and rewards. For instance, customers earn points on every dollar they spend, for writing product reviews, bonus points during special offers, points on birthdays, etc.
The dedicated loyalty program page on its website clearly explains how the points can be redeemed. The brand recommends products against which points can be redeemed, making it easy for loyalty members to use the points and make quick purchase decisions. The three-tier loyalty program offers different benefits to each member tier.
8. Sally Beauty Rewards Program
Sally Beauty offers beauty and cosmetics products and has employed excellent cosmetics customer retention tactics via its loyalty program. Its rewards program is called Sally Rewards. The program offers various perks such as free shipping on all orders, birthday gifts, members-only savings, reward points on every purchase, welcome gift, anniversary gift, among others.
The brand has kept the program simple and easy to understand for its customers. One of the biggest reasons customers end up not redeeming points or leaving loyalty programs is because they find it hard to understand. However, Sally Beauty has addressed this by keeping the program simple with three tiers – Preferred, Elite, Credit Card Holder, with different benefits under each tier.
9. Blumetopia
The beauty and cosmetics brand, Blume has a rewards program called Blumetopia. The loyalty program page on the website mentions details of the program in a fun and colorful manner. Customers get points to join for free, and earn more points for shopping, writing reviews, engaging on social media, etc. The points are called Blume Bucks.
The brand targets the younger generation with its fun and colorful vibe. The three tiers are titled, Friends, BFF, and Soulmates. The program also has a referral program attached to its loyalty program, where customers can refer a friend and earn points. Attaching a referral program is an excellent beauty loyalty program strategy that helps brands attract more loyal customers. What is more, the loyalty program page also tells members the many ways in which they can redeem the points. Many loyalty program members fail to use their points because they aren’t aware of the ways in which they can be used or the many benefits attached to the loyalty program.
10. Glow Recipe’s Club Glow
Here’s another fun and colorful loyalty program designed for the younger generation — Glow Recipe Club Glow. The cosmetics brand’s loyalty program has three tiers – Bouncy, Dewy, and Ultimate. The three tiers offer exciting rewards such as joining points, birthday gift, reviews, points for signing up for SMS and email, social media follows, reading articles on the blog, etc.
The program also offers exclusive products and recommendations every month, enhancing its cosmetics brand loyalty. Sending monthly recommendations is an effective tactic to keep customers engaged on a regular basis, stay in touch with them and enhance customer relationships.
How to create a customer loyalty program for beauty, cosmetics and skincare brands
Here’s a quick step by step on how to create a customer loyalty program using a solution like Appstle:
1. Design a loyalty program that aligns with your brand
There are many ways for organizations to incentivize their existing customers, such as offering discounts, money-back guarantees, freebies, and more. Businesses must craft a loyalty program that aligns with their core offerings, incentivizing and appealing to their customers.
Here are a few common examples of loyalty programs:
- Points-based loyalty programs: These reward customers based on specific actions like referrals, repeat purchases, and subscriptions.
- Tiered loyalty programs: These offer customers different benefits based on their spending level.
- Paid loyalty programs: These require customers to pay a fee to receive specific benefits.
- Value-based loyalty programs: These programs showcase a brand’s values by donating a portion of sales to specific charities or causes.
- Gamified loyalty programs: These offer games or challenges to keep customers engaged.
2. Implement omnichannel customer service
One of the best ways to build customer loyalty is to be there for them when they need help. Implementing a multi-channel customer service system is a great way to connect with customers, especially when they need support. With multiple channels, you can interact with them more often, positively influencing their experience.
Offering an omnichannel experience across different platforms, channels, and devices can enhance customer satisfaction and make your customer service more accessible. This is particularly helpful for frustrated customers in need of support. Using a help desk and live chat tools or chatbots can reduce the workload of organizing and distributing incoming requests for smaller teams.
3. Personalize the customer loyalty program
Businesses can use gathered data to personalize upcoming offers for their existing customers. They can use data to understand what customers like and how they shop and offer rewards, incentives, and perks that suit their needs and interests.
With the help of data analytics, businesses can gain insights into each customer’s purchasing history, preferences, and engagement patterns. Whether recognizing milestones such as birthdays and anniversaries or providing personalized recommendations based on past interactions, loyalty programs must be designed to nurture a long-term connection with the customers.
For instance, if a beauty brand retains data from previous purchases, it can draw insights from a customer’s past engagements, including the frequency and scale of those interactions, to enhance the effectiveness of future communication efforts.
4. Prioritize customer over competition
To create a successful loyalty program, it’s essential to prioritize your customers’ needs and wants over your competitors’ strategies. One way to do this is by personalizing rewards to reflect individual preferences, purchase history, and engagement.
Another vital aspect is implementing a transparent points system that rewards various interactions, from purchases to referrals. This helps create a sense of community by encouraging interactions among customers.
Continuously gathering customer feedback is also essential to refine the program and ensure it meets their changing needs. By placing the customer at the center of your loyalty program, you’ll nurture stronger connections, strengthen brand loyalty, and stand out from the competition.
5. Pick a meaningful name
The name you choose for your brand’s customer loyalty program should be meaningful, so much so that it raises their curiosity and appeals to them to participate. It is crucial to ensure that the name stands out from all the other loyalty programs that customers might already be part of.
The name should inspire and excite the customers to be a part of the program without having to explain about discounts or rewards.
6. Offer various rewards for different customer actions
One way to show your customers that you value their loyalty is by rewarding their actions beyond just making purchases. Customers who engage with your brand by watching product videos, using your mobile app, sharing social media content, and subscribing to your blog add value to your brand, so rewarding them for their engagement is important.
Don’t rely just on discounts to reward the customers for the value they provide. For instance, customers who spend a certain amount or earn enough loyalty points could redeem them for free tickets to events, complimentary subscriptions to additional products and services, or even donations made on their behalf to a charity of their choice.
7. Promote program enrollment
Develop a marketing strategy to promote your loyalty program and encourage customer enrollment. Use various channels such as email marketing, social media, in-store signage, and website banners to raise awareness and incentivize sign-ups to encourage multiple enrollment opportunities and actively promote its benefits. For instance, when customers shop on your e-commerce platform, display the potential points they could earn next to the product price.
Consider a scenario similar to being at a coffee shop where, after making a purchase, the cashier mentions that customers could earn double loyalty points if they sign up for the store’s app. Use social media platforms to spread awareness about your loyalty program and its perks, increasing participation, customer retention, and satisfaction.
8. Make the experience like a game
Display potential points next to product prices on your e-commerce site, transforming shopping into a rewarding challenge. Offer bonus points at checkout for signing up, which excites customers to unlock achievements.
Use social media to hype the perks and add on-site pop-ups celebrating points earned, creating a sense of accomplishment. By gamifying enrollment and participation, you engage customers fun and interactively, driving loyalty, retention, and satisfaction.
9. Communicate consistently and gather feedback
Consistency is key in designing and implementing loyalty programs. While modifications may be necessary for optimal results, maintaining a consistent approach ensures a positive customer experience. However, changing engagement strategies frequently can confuse or frustrate customers.
Effective communication goes beyond just promotional content; it also involves gaining feedback from engaged audiences. Surveys, customer events, and direct inquiries help businesses gather valuable insights to refine their programs, products, and services.
Wrapping Up
The beauty industry’s revolution has shown that loyalty programs go far beyond transactional interactions. They demonstrate the power of customer-centric thinking, engagement, personalization, and even social impact.
You need to create well-designed loyalty programs that go beyond mere points and discounts, developing a dynamic relationship between brands and customers. That’s where Appstle comes into play.
With Appstle, brands can increase customer retention while offering personalized experiences to every customer.
Get started to understand how Appstle can help you take your loyalty programs to the next level.
FAQs
Which is the best Shopify customer loyalty app?
One of the best Shopify customer loyalty apps is Appstle Loyalty and Rewards App, preferred by many merchants across the globe. The app offers comprehensive and intuitive features to set up and manage loyalty programs that help brands scale and increase profits.
How do loyalty programs enhance brand loyalty?
Enhancing brand loyalty includes factors beyond products and services. Aspects such as high engagement levels, exciting online experiences, loyalty and rewards points, rewards such as supporting social causes, etc. help enhance brand loyalty more than monetary benefits alone.
What are loyalty points for customers?
Loyalty points or reward points are points or rewards given to customers for various activities. For instance, for making purchases, for writing reviews, for social media follows and shares, etc. Customers can redeem loyalty points against purchases.
What are the 4 C’s of customer loyalty?
The 4 Cs of customer loyalty are: captive, contented, convenience-seeker, and committed. The captive member is an engaged member who is interested in your program, contented members are those who find satisfaction in your program, convenience-seekers typically join loyalty programs for the convenience factors, and committed are long-term loyal customers.
How much does it cost to run loyalty programs?
The cost of setting up and running a loyalty program depends on the individual brand, industry, and the program. Planning from the start and integrating a good customer loyalty app on your Shopify store can ensure a cost-effective and profitable loyalty program.
