The Future of Customer Loyalty Programs Post COVID-19

Last Updated: December 2023

The profound shift in customer buying behavior triggered by COVID-19 is expected to have a lasting impact on the fortunes of brands across the world. While e-commerce stores witnessed a surge in business as entire nations went into lockdown, customers have been more conscientious in their choice of products and brands than ever before. Discretionary spending has been restricted with buyers choosing to defer purchases of non-essential items, at least in the short term.

With orders getting delayed and returns getting more complicated, the odds of a customer choosing a rival brand are considerably higher in the new normal. Almost overnight, e-commerce stores have been forced to rethink how to engage and retain their customers.

Changing market dynamics in terms of supply chain disruptions have highlighted the need for e-commerce brands to go beyond product quality or affordable pricing and create loyalty through exceptional customer service and innovative loyalty programs. Like many brick and mortar retail stores, online businesses need to adapt their loyalty programs to better appeal to customers.

If you haven’t had a lot of luck with your own loyalty program, you’re probably thinking of scrapping it altogether. However, the answer lies not in doing different things but doing things differently. Here’s why: according to a KPMG study, 96% of customers say that businesses need to find newer ways to reward them.

Here are a few ways in which brands can adapt underperforming loyalty programs to provide better value for customers in the new normal:

Prioritizing customer satisfaction

Multi-tiered customer loyalty programs with their often complicated qualifiers about how much customers need to spend and by when may not be enough to retain customers anymore. Customers may not be inclined to wait for weeks or months to redeem their points. So, it is important for brands to make rewards easier to earn for their customers. Instead of looking at purchases alone, tweak the eligibility criteria to drive specific actions such as posting positive reviews on social media or referring friends and colleagues.

VIP upgrades:


The top 20% of customers typically bring in 80% of your business. Every dollar you spend on providing them VIP service is well spent. However, the vast majority of your average customers also aspire to get VIP perks even if they have to pay for them. Amazon Prime is an excellent example of this. Customers are usually not averse to the idea of paying a certain amount to get exclusive discounts, expedited delivery, or free shipping.

A customer may, in fact, feel compelled to keep buying from you to avoid losing VIP benefits, giving you the opportunity to up-sell and cross-sell new products. You must ensure, however, that customers get their money’s worth on a VIP upgrade.

Gamify your loyalty program:


Adding an element of adventure to an otherwise uninspiring pursuit of reward points can greatly elevate the customer experience. Gamification, a concept that turns earning rewards into a game-like experience, is a great way to hook customers to your products. It is a concept that is catching on in the e-commerce industry. According to Mordor Intelligence, gamification can boost engagement and repeat visits by up to 30%.

The secret is to keep customers guessing about what’s coming next with a combination of fixed and random rewards to keep them engaged. Over a period of time, customers are likely to develop a habit of participating in such contests, boosting customer lifetime value and referrals.

Use the customer data at your disposal to understand customer preferences in terms of rewards to make their participation in your loyalty program worthwhile.

Team up with other businesses:

If the returns from your loyalty program have been less than stellar, it may be time to team with other online stores in order to encourage more customers to buy from you. Research shows that 82% of customers preferred a wider variety of rewards to choose from. The hospitality and air travel industry have long leveraged loyalty partners to come up with interesting loyalty options for customers. This can work well for online e-commerce stores, especially if you have a niche product or service and want to promote your product to newer audiences.

Ensure that you read the fine print in terms of the commission rates payable so that there are no problems once the partnership loyalty program is up and running.

Hybrid programs


The pandemic has brought about a significant shift in customer behavior which is likely to take months, if not years, to stabilize. If you aren’t sure about which loyalty program to implement, take the best elements of the above loyalty programs, and create a tailor-made one of your own. Reinventing your loyalty program by blending transaction-based and activity-based rewards points can give a new lease of life to your existing loyalty program. The best part: you do not have to build one from scratch!

For example, you can offer sign-up bonuses for customers referring new users, reduce the eligibility criteria so that more customers can get the benefit of loyalty programs, and run contests to engage customers and drive customer lifetime value.

Last words

Customer loyalty programs can be a key tool for driving revenue growth without spending a ton on acquiring new customers. However, brands will need to get proactive about how they conceive and implement loyalty programs with the focus being on exclusivity and higher frequency of rewards. Businesses typically attract a lot of questions from customers relating to their loyalty programs. The questions may be about eligibility criteria, redemption or even upgrading to VIP.

Needless to say, such interactions provide an excellent opportunity for your customer support team to upsell or cross-sell customers. A dedicated team for handling loyalty program-related queries is not a bad idea given the potential for repeat sales and higher engagement. Bringing in an outsourced customer support provider like Helplama can be the perfect way to reduce operating costs while driving a superior customer experience.

Alternatively, you can also consider Helplama Helpdesk if you want to improve the efficiency of your customer service team. It is equipped with automated workflows, market automation, a live chat feature, and much more to improve the productivity of your support team. Furthermore, they also offer customized pricing plans.

So, what are you waiting for?

Start Your Free Trial Now!



ChatGPT + Customer Service

Claim Your FREE Credits Now!

Get the code. Use anytime in the next 6 Months.


Claim Your 6 months of FREE Credits Now!

Get the code. Use anytime in the next 6 months.

Helplama Helpdesk is now!