How to Leverage Digital & Physical Rewards to Your Customers


Did you know that it costs 5 times more to acquire a new customer than to retain an existing one? So if you want to reduce your marketing costs, increase your revenue, and improve customer loyalty, you need to learn how to leverage digital and physical rewards to your customers. You must also invest in customer loyalty programs.

Customer loyalty programs can make your customers feel special. It makes them feel appreciated. And when your customers feel appreciated, their cart value goes up. They’d want to buy more of your products. This increases your average revenue per user and it reduces your customer churn rate.

Using the digital & physical rewards strategy can help protect your customer base from your competitors’ aggressive luring tactics. It also increases your customer retention and loyalty.

According to a study conducted at the University of California Berkeley (Haas School of Business), loyalty programs can increase revenues by 10 percent. It increases your product demand, especially during low seasons. This strategy also gives you an opportunity to up-sell and cross-sell.

Digital and physical rewards increase your brand’s likability and reputation. It also increases your sales and profits. It helps you retain existing customers. It allows you to build an army of brand advocates and increase customer lifetime value.

Remember that most customers use their emotions in making purchasing decisions. They want to buy products from brands who value them. This is why building a solid customer rewards program increases customer engagement and allows you to attract new customers.

How to Build an Efficient and Effective Rewards System

Delivering physical and digital rewards to your customers can do great things for your business. Unfortunately, customer reward systems do not always work.

Here are a few tips that you can use in leveraging digital and physical rewards to increase your profits and revenue:

1. Use rewards to solve the problem areas of your business.


It’s not wise to give out $5 rewards for every $10 purchase. To maximize the returns of your physical & digital rewards, you must choose the right action to reward. You must choose rewards to solve some of the problem areas of your brand.

Let’s say that you’re selling yoga pants and you decided to produce yoga mat line. The yoga pants are selling like hotcakes. But, unfortunately the mats are not selling as much as you hoped.

To solve this problem, you can give out rewards if your customers purchase two yoga pants and one mat. You can give out a gift certificate or a free affirmation audiobook.

Now, let’s say that you own a skincare brand. Your moisturizers and night creams are doing well. But, your face masks are not selling well and your inventory costs are increasing every week. To solve this problem, you can use facial masks as rewards. You can give away five facial masks each time a customer purchases $300 worth of moisturizers and products.

This strategy does more than increase your sales. It also helps you introduce your facial mask products to a wide audience. It increases your revenue and encourages brand loyalty. Not bad, right?

2. Choose rewards that are appealing to your customers.


To get the most out of your rewards, you have to deliver physical and digital gifts that your customers actually want. This is why you should give rewards that are related to your products.

Let’s say that you’re selling mangas or Japanese comic books. Most manga lovers also love animes, so a free anime movie can motivate them to buy 3 to 5 comic books.

If you’re selling yoga products, it may be a good idea to give away essential oils. You have to make sure that your rewards are related to your product.

Here’s a list of rewards that may inspire your customers to hit the ‘add to cart’ button or refer your product to another user:

  • Provide a free upgrade or a discount.

If you’re offering a service, it’s a great idea to provide a free upgrade in exchange of a referral. You can also give out discounts and coupons for every substantial purchase. That would definitely make your customers’ day.

  • Make a donation in honor of your customers.

Everyone wants to feel like they’re contributing something to the society. So, why not donate a few dollars in honor of your most loyal customers. That would get them into the blissful altruistic zone.

  • Send an awesome holiday gift.

Don’t we all want to receive a holiday gift? Sending gifts to your customers to boost holiday sales is always a good idea.

  • Give out personalized gifts.

According to a study published in 2016, there’s a huge correlation between customer satisfaction and personalization. Sending personalized gifts make your customers feel important.

  • Hand out company merchandise.

If all else fails, you can always give away company merchandise, such as water bottles, baseball caps, mugs, T-shirts, and pens.

3. Set a reasonable budget.


Keep in mind that a customer reward program is a marketing strategy and so, you must be mindful of your spending. You have to make sure that you’re getting optimum returns for your rewards.

Ideally, it’s best to give away not more than 20 percent of your profit. For example, if you’re selling a $100 and your profit is $30 for each sale, it’s safe to give $30 reward for every $ 500 worth of purchase (that’s 20 percent of your $150 profit).

4 Make it a game.


Make the reward system fun and exciting that it almost feels like they’re playing a game. Creating an amazing “mission-based” rewards program can increase customer engagement and satisfaction. This keeps your customers coming back for more.

5. Use a customer reward platform.

It’s sometimes difficult to streamline your customer reward system. This is the reason why you should use a customer reward system.

There are a number of customer loyalty platforms, such as Zoho CRM, TapMango, Kangaroo, and Loopy Loyalty.

You can also use Amazon’s new rewards delivery platform called Amazon Moments.  

Using Amazon Moments to Deliver Digital and Physical Rewards to Your Customers

“Amazon Moments” is a marketing tool that allows businesses to deliver rewards to their customers. It is perfect for those who wish to deliver rewards at a large scale.

Launched in the early part of 2019 and since then, the Amazon Moments uses a handful of big brands like Tik Tok, Disney Heroes, Bravo, and Washington Post started using it.

This reward delivery system works on the web, iOS, FireOS, and Android.  It is available in over a hundred countries. This is a lightweight API that web developers can easily integrate with their website and app.

Whenever a user completes a certain action, the Amazon Moments API leads them to a URL where they can redeem their rewards through Amazon.

But, if you decide to use Amazon Moments, you can only deliver physical & digital rewards that are available on Amazon. It can be rubber shoes, a Bluetooth speaker, or an ebook.