Building customer loyalty is more critical than ever in today's competitive business environment, and a popular way to achieve this goal is to (surprise, surprise!) create a loyalty system.
Loyalty programs are a proven method of rewarding customers for their ongoing engagement and encouraging them to choose your brand over the competition. Loyalty software makes it easier to establish and nurture strong customer relationships by automating loyalty processes related to tracking, management, and analysis.
But with so many loyalty software options out there, how do you choose the best one for you? That's where our comparison guide comes in!
We've researched and analyzed ten of the best customer loyalty program software options on the market, considering factors such as overall features and capabilities backed by existing customers' reviews.
Whether you're a small business owner looking to implement a loyalty program for the first time or a large enterprise seeking to upgrade an existing solution, we'll give you an overview of each solution, along with the pros and cons, to help you make an informed decision.
We've covered loyalty software and all its aspects so many times on our Insider blog. Yet, in a nutshell, loyalty software is a tool that allows you to track and manage customer purchases, reward points, and other loyalty program activities in a centralized and efficient way. It also allows you to communicate with loyal members and offer personalized discounts, rewards, or exclusive offers based on their individual preferences and behaviors.
You can easily build a custom loyalty program, as it can be tailored to different industries and their specifics, including retail, banking, fashion, beauty, fintech, hospitality, FMCG, or more. The loyalty system can be delivered as a standalone app or as a solution integrated into your company's existing technology stack.
Any loyalty software is primarily designed to retain and expand the customer base by rewarding buyers for their loyalty, and typically includes basic features such as:
So, loyalty software brings all sorts of benefits and assists companies in building strong customer relationships and delivering personalized experiences.
Customer tracking is an essential feature of loyalty program software that allows you to match transactions to member profiles, monitor behavior and purchases, manage loyalty points, and other loyalty activities in a centralized location.
This can include tracking customer transactions, monitoring reward point accumulation, managing point redemptions, or selecting rewards. All of that wraps up in the basic metrics of a loyalty program. Customer tracking is strongly tied to a loyalty engine’s Customer Database and Customer Relationship Management (CRM) options.
Some loyalty software systems include advanced tracking features, such as observing loyalty members' activities across multiple channels, including in-store, website, or mobile app. In addition, the tracking functionality is essential to accurately monitor loyal customers' actions to ensure they're receiving the incentives they're entitled to.
A loyalty system can provide valuable insights into customer behavior, allowing you to understand them better. The most advanced loyalty engines allow the collection of any transactional and behavioral data while using it in the loyalty program configuration.
Besides the basic rewards options seen in customer tracking, loyalty engines can also boast advanced loyalty rewards management features.
These advanced reward management capabilities include setting up reward catalogues, uploading rewards from external vendors, different types of rewards (digital, physical, coupons), targeting rewards for specific customers or segments, stock management, and more.
Related features in loyalty software include gift card management, point systems, and gamification capabilities.
Another vital feature of loyalty software is personalization, meaning the ability to communicate directly with customers and trigger them with personalized loyalty campaigns and rewards based on their individual preferences and behaviors.
Personalized loyalty programs can include:
The data shows that 53% of loyalty program owners plan to offer personalized rewards or deals in the next three years to increase customer lifetime value. That’s the spirit!Â
Beyond that, many loyalty experts back up this statement that personalization will have a key impact on building long-term customer relationships.
Our Loyalty Program Trends 2024 report found out that the future of loyalty will be embedded in hyper-personalization, combining data from different sources into tailored campaigns and offers at every touchpoint.
A respondent, Deon Oliver, consultant with experience in Achievement Awards Group, eBucks, and MTN, when asked, "How do you see the future of loyalty programs over the next 2–3 years?" said that Programmes will become more and more sophisticated – constantly embracing the power of data to drive hyper-personalised campaigns and offers."
The same is stated by another expert, Max Savransky, Loyalty and CX Expert. Co-author of "Loyalty Programs: The Complete Guide”, who, answered "Better segmentation and personalisation across the board, a deeper integration of best practice loyalty principles into CX journeys, a bigger focus on more strategic partnership networks, and smarter ways to leverage AI capabilities."
Advanced personalization capabilities in the ticketing system allow you to segment and reward customers based on their demographics, psychographics, or past activities, or use machine learning algorithms to predict which shoppers are most likely to respond to specific offers.
The personalization feature helps companies create more engaging experiences that drive customer loyalty and satisfaction. It can also improve the effectiveness of a loyalty program by targeting rewards and incentives to selected audiences.
Reports and analytics built into loyalty software provide data and insights on customer behavior. This also allows you to automatically collect customer feedback and make informed decisions about your loyalty program development strategy or planned marketing activities. The most common areas addressed by analytics are tracking customer engagement and participation, monitoring the effectiveness of specific rewards or promotions, and identifying loyalty trends or patterns.
Specific loyalty software systems include advanced capabilities, such as generating custom reports or sharing loyalty program data with existing business intelligence tools to match them with the other information in the organization and understand customer loyalty program members better.Â
You can leverage the data you collect to optimize your loyalty program and see what's working and what's not. Then, you can confidently make adjustments based on these findings. You can also identify opportunities to improve the customer experience, such as by offering a new or improved rewards catalog or by addressing customer needs and concerns about the products/services you deliver.
The ability to scale a loyalty system vertically or horizontally through integrations is another feature you should look for in your final choice. You can never tell whether you will need to include a new integration with a customer relationship management (CRM) system or with tools such as accounting software, inventory management systems, or marketing automation tools. Your loyalty system should also provide extensive API documentation, so you can build custom integrations.
Correctly implemented loyalty system integrations streamline business operations by providing a single, centralized place to manage customer interactions and data. Only then can you get a complete picture of customers, their activities, and the quality of the stored information.
Pay attention to whether your loyalty software provider allows you to create a dedicated integration with a mobile app. After all, it's the most efficient way to track loyalty activities and redeem points on the go. A mobile app is a convenient and user-friendly way for customers to engage with your loyalty program. It can work wonders for your desired brand traction! Also, you should be able to customize the look and feel of your app, as well as integrate it with other mobile marketing systems or platforms of your choice.
Bear in mind that Millenials are 14 times more likely to access loyalty programs via smartphone than from a computer. That's why you need a well-designed loyalty mobile app that includes features like tracking customer rewards and purchases, offering personalized recommendations and deals based on past behavior, and enabling direct payment redemption through the app. These simple yet powerful capabilities can help you create a more seamless and engaging mobile experience for your users.
The global loyalty management software market is booming! It's expected to grow from $5.57 billion in 2022 to $24.44 billion by 2029, showing a CAGR of 23.5%. More and more companies are investing in loyalty programs, and they're becoming one of the essential tools for generating revenue.Â
On top of that, the loyalty solution market is highly fragmented, with different solutions available for SMB or Enterprise customers. Companies have many options at their disposal when choosing loyalty software, and the best customer loyalty solution will depend on their specific needs and goals. They can pick from solutions such as:
… and so on.
The landscape continues to evolve, and whenever a new player emerges, the rest observe closely.Â
Today, the loyalty ecosystem is also changing due to existing loyalty trends. This brings you to the real showstopper, headless architecture, which is the most modern way to develop a loyalty system. Our observations show that enterprise clients with the most mature technical teams are moving from monolithic to headless solutions to make the technology more cost-effective, quicker to expand, and flexible to personalize. This is fast becoming the new standard!
There is also the so-called"build vs. buy" dilemma, where companies with unique requirements face a choice between:
No one said that building a loyalty system would be easy — you definitely have to do some digging beforehand.
Another distinguishing feature of the current loyalty landscape is that marketers and product teams prefer to build on top of their stack and add specialized components rather than replace existing solutions, for example, marketing automation or CRM.Â
Besides, enterprise clients want full ownership of their data. They often require full control over customer information, which can be achieved with on-premise or private-cloud deployments (where the database is separated from other entities).
Businesses implement technology solutions to further manage loyalty programs, including CRM systems, mobile apps, point-of-sale (POS) systems, marketing automation platforms, mobile marketing platforms, mobile payment systems, customer feedback and review platforms, or social media management tools. All of these also play an important role in the loyalty landscape.
In the following comparison, we looked closely at the 10 available loyalty solutions that dominate the market. You can read about their overall performance expressed by our reliable loyalty experts, as well as the pros and cons voiced by their users, which we sourced from trusted review platforms.
Open Loyalty is a headless loyalty platform built with flexible building blocks for creating customized loyalty program mechanisms. With the world's most adaptable API, pre-built loyalty mechanics, and Open Loyalty Language, you can quickly roll out engaging loyalty features and create fantastic user experiences at every touchpoint.
This solution is ideal whenever you need to create your own loyalty program or plan to extend existing systems with a set of loyalty or gamification mechanics.Â
This is especially true for two types of cases:
Like no other solution, Open Loyalty is quick to implement and offers freedom of development and integration at the API level. In addition, Open Loyalty is available in SaaS and On-Premise/Private cloud models.
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Open Loyalty clients appreciate the platform and its capabilities, saying:
Read more opinions on Open Loyalty.
To book a demo, click here.
Smile.io is a loyalty platform that provides reward programs that help eCommerce brands turn one-time sales into repeat ones. This solution is great for SMBs based on Shopify. In the main, Smile.io provides a loyalty program widget which can be added to the eCommerce. You don't need a developer to manage the loyalty program widget. With Smile.io's admin dashboard, changes are quick and easy.
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Zoho CRM is a Customer Relationship Management Platform with loyalty features. It claims to be useful for businesses of all sizes and, with a low entry pricing point and different tiers, it’s a comfortable option for ventures that are starting out.
Being an all-in-one platform, Zoho shines in terms of quick deployment of ready-made components, but is not the ideal solution for companies who need customization to handle advanced use cases.
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Talon.One is a promotion software offering the functionality to engage customers with coupons, in-cart promotions, bundling, discounts and loyalty campaigns. So, suppose you need a promotional engine with loyalty elements for online operation, Talon.One might be a good option. With this solution, you can deliver all eCommerce promotions to your existing marketing platforms and CRM tools.
Sources:
https://www.capterra.com/p/159778/Talon-One/
Antavo is a loyalty no-code platform. The company provides ready-made hardware components to support kiosks or payment card terminals that could work well for brick and mortar businesses.Â
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Emarsys Loyalty is an add-on for the Emarsys platform that helps businesses create highly personalized loyalty experiences. This solution tracks customer behavior, context, and purchases to offer a personalized experience, which can help increase lifetime value and return on investment. Marketers can manage it without the need for IT support.
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Annex Cloud (formerly Social Annex) is an all-in-one loyalty platform from the US market, founded in 2010. You can use it to launch and manage loyalty programs that boost customer engagement and lifetime value, reduce churn, and drive revenue. The solution offers integrations, loyalty widget and a unified suite of contests, reward, and gamification applications for customers.Â
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Oracle Cloud CX is a customer experience solution that covers every stage of the customer journey, including the internet, contact centers, and social media. It's particularly suitable for companies with large customer networks in various industries, such as retail, travel and entertainment, the public sector, and online services.
Sources:
https://www.softwareadvice.com/za/crm/rightnow-cx-profile/reviews/
Fivestars is a marketing platform that provides businesses with a range of tools to help them attract and retain customers. It features easy-to-use technology, customizable rewards and promotions, and automation. With Fivestars, businesses can reach out to new customers through SMS, email, and a mobile app and keep them coming back with targeted marketing campaigns. This platform is designed to help local businesses compete with larger retailers by providing them with the tools they need to market themselves effectively.
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Zinrelo is a SaaS-based loyalty platform that provides loyalty data analysis and ongoing strategic advice to increase customer retention, generate recurring revenue, and maintain overall profitability. The company presents itself as a good choice for medium to large companies.
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There's an ongoing debate about the benefits and drawbacks of building vs. buying a loyalty product or service. One argument in favor of building a loyalty solution from scratch is that it can be customized to a company's specific vision and requirements. This includes the design and development phase and the ability to make future improvements without being constrained by a ready-made solution.
Another advantage of building from scratch is the freedom to choose the technology stack and hosting location, which is especially important for companies with sensitive data and high-security requirements. However, this approach also has significant downsides, including more extended time to market, high development costs, and ongoing maintenance costs.
It can also be risky, as it comes with expensive mistakes and the possibility of distraction from the main goal of keeping customers satisfied. Additionally, building a backend system from scratch may divert a team's attention away from creating unique and memorable customer experiences that set the brand apart from the competition.
On the other hand, the "off-the-shelf" option offered by SaaS companies is an attractive choice for businesses looking to invest in loyalty programs due to the cost and resource savings, as well as the quality assurance. By purchasing a ready-to-use solution, companies can benefit from a loyalty system that has been extensively tested by many brands and is typically integrated with other systems and processes, such as POS or CRM. This can ensure a level playing field in competition and quicker time to market.
However, this option also has limitations in terms of customization and control and may require companies to compromise on their core vision and the desired shape of their loyalty program. Additionally, providers may offer several features that aren't necessary or already exist, which can add unnecessary complexity and cost. Legacy, one-size-fits-all solutions based on a monolithic model can also be inflexible and limiting as a business grows and scales.
Fortunately, the choice between building or buying a loyalty product/service is no longer a strictly binary decision! You can take advantage of both approaches by purchasing foundational and generic loyalty products while building unique and innovative features that set you apart from the competition and provide value to your end-users.
At Open Loyalty, we support exactly this build and buy approach so that you can use headless software with MACH principles and hybrid architecture to strike this balance to deliver a personalized and effective loyalty solution. This allows you to focus on building unique, memorable customer experiences and original features while relying on established and reliable products and services for the underlying infrastructure.
If you're still swinging from the decision to build and buy your loyalty solution, let us give you some groundbreaking data and arguments to make sure it's a worthwhile investment.
It'll come as no surprise when we say that loyalty programs effectively help companies retain and grow their customer base — mainly because they give loyal members incentives to stay with a particular brand or company. According to Bond Brand Loyalty research, the average U.S. consumer belongs to 16.7 customer loyalty programs, and about 90% of businesses have some kind of loyalty program. And here's your company missing out on this amazing advantage for end-users.Â
Research also shows that customers who participate in loyalty programs tend to have higher levels of brand loyalty. You need to foster bonds with customers, and you can do so without vast and pricey marketing and promo campaigns.
Other data reveals that 68% of loyalty program members spend more money to maximize earning points. Who doesn't want an additional revenue channel, right?Â
If you're considering offering paid loyalty solutions, the truth is that they can also do the trick for you. McKinsey's data shows that 62% of consumers spend more money on a brand after signing up for a paid loyalty program, and 43% of people surveyed are more likely to make weekly purchases since joining a paid loyalty program.
Even from this small sample of data, you can see that a well-thought-out loyalty solution can create the desired "stickiness" with your audience. As such, if your company doesn't have such a solution, you're missing a key way to build brand ambassadors and collect data to help you better target your program.Â
To get the most value out of a loyalty program, it must be designed and managed head-on. This includes offering meaningful rewards that align with customer interests and preferences, making it easy for shoppers to participate and redeem rewards, or communicating regularly with loyal members about the program.
In addition, make sure that your loyalty program is integrated with other areas, such as customer support and product/service quality, to create a holistic and positive customer experience. A customer loyalty program, if run well, can be a valuable tool for customer retention and loyalty-building.
We hope our comparison guide has given you a thorough understanding of the best loyalty software options on the market and the key features and capabilities each solution offers. By carefully considering your business needs and goals and taking into account the information in this guide, you should be able to choose the loyalty software that best suits you.
Take as much time as you need to carefully research and compare your options. You should certainly try to send an RFP to the best loyalty providers. Don't be afraid to ask questions and request a demo, a free trial, or another test to get a better feel for each customer loyalty solution. Consider the level of support and resources offered by each provider, as well as their track record and reputation on the market.
Loyalty software is an important investment for your business because it can help you retain and grow your customer base, increase customer satisfaction, drive long-term success, and create rewarding experiences for your audience. Keep in mind that the best loyalty software for your case also depends on factors such as the size of your company, the type/number of experts on board, the complexity of your customer loyalty program, and your available funding pool.
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To get some loyalty program inspiration, check out the Top 100 Loyalty Programs report, or peek into the future of the loyalty industry with our Loyalty Trends 2024 research.
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