A loyalty program should be more than just points given toward purchases and redeemed on the next purchase. That’s because rewards programs have the potential to increase customer engagement, bring more customers, and increase repeat purchases.
If you’re a Shopify brand looking to increase your loyalty program ROI, explore these 6 strategies that actually impact your revenue and improve ROI.
A quick snapshot of the key strategies
- Track extra spending: Compare what loyalty members spend vs. non-members. If members spend more and buy more often, your program is working.
- Measure long-term value: Track how many members keep buying after 6–12 months. Customers who stay longer are worth far more to your business.
- Reward actions that drive sales: Give bigger points for larger orders, referrals that convert, and subscription sign-ups, not just likes and reviews.
- Make sure rewards are profitable: Set a minimum order value for redemptions and don’t let customers stack loyalty points on top of existing discounts.
- Identify your top 20%: A small group of customers drives most of your revenue. Find them, segment them, and give them exclusive perks to keep them loyal.
- Connect loyalty to subscriptions: Offer extra points on subscription orders and create tier upgrades for subscribers. These customers spend more, refer more, and churn less.
6 strategies to increase loyalty program ROI on Shopify
Here are some strategies you can pick and choose for your Shopify store that can impact your loyalty revenue positively.
1. Tracking incremental revenue from loyalty members
Think about this – if you remove the loyalty program from your Shopify store, will your sales drop? To know the answer, you should compare how much these two customer groups spend:
1. Customers who are part of your loyalty program
2. Customers who are not part of your loyalty program
If loyalty members spend more and buy more often, it is proof that your program is working. However, to get a fair picture, compare customers with similar shopping habits.
Here’s what you can do:
- Keep a small group of eligible customers outside your loyalty program for 90 days, then compare their spending to members
- Tag every order in your store as coming from a member or non-member. Most email tools let you automate this
- Check this comparison every month against your regular sales numbers
2. Measuring impact on customer lifetime value (CLTV)
The key goal of any loyalty program should be to turn one-time customers into long-term, regular customers. To put things in perspective, a customer who buys from you six times in a year is more valuable than one that buys once and never returns.
To measure this, track the number of members who buy from you after 6 to 12 months, and how often they buy. That’s retention and repeat purchase rate. If your loyalty program members buy more, and stay longer, the program is a success. Also, track other loyalty program metrics based on your program goals.
How does retention make a difference to your loyalty program?
Even if you manage to retain 10% more customers for an extra year, it can add to the CLTV.
Here’s how to increase CLTV through your loyalty program:
- Look at each loyalty tier separately. Are your top-tier members actually buying more often? If not, rethink
- Track how many members come back within 30, 60, and 90 days of their last purchase. Watch for drop-offs. That’s when you must automate retention strategies with a loyalty and rewards app
- Use your Shopify store’s built-in tools to estimate how much a new loyalty member is likely to spend over the next year. Your loyalty app can also help you collect and analyze this data
3. Linking rewards to revenue-driving actions
While it’s important to offer rewards for different actions, it’s also important to note that it doesn’t always lead to more sales. For example, you might offer rewards for writing product reviews, for social media likes and comments, etc., but that doesn’t mean customers will buy more.
There are ways you can link rewards to actions that drive more sales. Here are some strategies that increase loyalty program ROI.
- Give bigger rewards for the actions that lead to more sales
- Give rewards for referrals that may lead to more sales
- Give more rewards for larger orders
- Rewards for upgrading to better products
- Run short ‘bonus points events’, for example, double points on bundles for 48 hours
- Automate different points values via your Shopify loyalty app
- Track and monitor which rewards actions lead to more sales along with other loyalty program metrics
4. Analyzing rewards redemption against profitability
When customers use their reward points for a discount, it’s actually a cost to your business. However, if these customers fill their carts and make purchases, it can be a profit for you. But that’s only if you ensure the orders they place are worth more than the rewards you’re giving.
Let’s understand this with an example.
If a customer uses a $10 reward on a $70 order, you’re giving a 14% discount. But if this customer stacks the loyalty reward on a product that is already on discount, it can eat into your profit margin.
Here are some tips:
- For every $1 reward redeemed, calculate the AOV and profit
- Set a minimum order value for reward redemptions. For example, points can be used only on orders over $50
- Do not allow customers to use points on top of discounted products. You can set up these rules via your rewards and loyalty app
5. Segmenting high-value loyalty customers
Typically, 20% of customers generate 80% of revenue. This 20% includes high-value customers. Most businesses know this. But they ignore it.
Segmenting these customers into a group and ensuring they’re kept happy is one of the best strategies to increase profits. Once you identify these loyalty members, you can keep them happy by offering perks such as early access, personal thank-you, or special invitations.
Here’s how to identify these customers and impact loyalty revenue:
- Look for members who have bought recently, buy often, and spend the most
- Customers who have bought in the last 45 days should be considered in your top tier
- Customers who have referred at least one friend
- Connect your loyalty tool to your email platform so your best customers automatically get added to a VIP list and receive the right messages
- Each quarter, check how much of your loyalty revenue is coming from your top 20%? Is it growing or shrinking?
- Run invite-only campaigns for your best customers. For example, a product preview, early sale access, or a simple “we’d love your opinion” survey
6. Integrating loyalty with subscription and upsells
One of the best strategies to increase loyalty program ROI is to connect the program to your subscription. Instead of offering points only on one-time purchases, you subscribers can also earn loyalty points on repeat orders.
This strategy works because customers who are both loyal members and subscribers generally spend more, refer more friends, and are much less likely to leave. They’re your most valuable customer type.
Here are some ways to integrate loyalty with subscription and upsells:
- Make subscribing feel rewarding. If signing up for a monthly subscription moves a customer into your top loyalty tier, it locks in predictable revenue for you
- Give loyalty members extra points on subscription orders. For example, 2× points per dollar on auto-refill purchases vs. one-time buys
- Appstle Subscription App and Appstle Loyalty & Rewards App can connect easily
- Create a loyalty-linked upgrade offer: “Subscribe to our bundle plan and jump straight to Gold tier.” This turns a price decision into something that feels like an identity upgrade
- Track how much extra money loyalty members are spending on upgrades and add-ons beyond their subscriptions. It is often the clearest proof your program is growing revenue, not just retention
How to increase loyalty program ROI on your Shopify store
The eCommerce brands that see the real results of their loyalty program are the ones that connect the program to their sales and profitability.
From connecting your loyalty program to subscription, to tracking every detail about which rewards customers are using more, every aspect matters.
To do so, you need a smart Shopify loyalty app. Appstle Loyalty & Rewards App provides comprehensive features to set up, automate, and manage your loyalty program.
Install Appstle Loyalty & Rewards App in your Shopify store today!
