The average retailer can see as much as 50% of their yearly sales volume occur during the holiday season. When you launch your rewards and loyalty program on Hydrogen, it’s important that you take advantage of this. By issuing your own branded cards, not only do you earn great interchange from Mastercard and Visa (see schedule here), but you also can take advantage of Hydrogen’s.
In this post, I lay out 10 important steps you can take to optimize your rewards and loyalty program:
- Treat every season as rewards season!
- Push card-linked offers to your customers in innovative ways
- Incentivize new cardholders with promotions
- Utilize crypto rewards to attract younger customers
- Make a great first impression
- Reward customers for referrals
- Partner with merchants that fit your brand’s mission
- Promote hyper-local businesses
- Give rewards for purchase categories whenever possible
- Get customer feedback early and often
Treat Every Season as Rewards Season
It’s important to view every month of the year as the holiday season. Consumers are constantly on the lookout for deals (see Honey’s $4 Bil sale to PayPal as an example). You can juice up the rewards you offer in November – December, but remember to have a compelling rewards offering throughout the year.
My Tip: run deals and promotions around important shopping holidays, such as Valentine’s Day, Mother’s Day, and the 4th of July.
Push Card-Linked Offers to Your Customers in Innovative Ways
Hydrogen sponsors card-linked rewards from dozens of merchants that can increase your interchange payouts as much as 20x! These rewards get automatically applied to the cards when your customers swipe. To optimize your earnings on Hydrogen, we recommend that you promote these rewards off the Hydrogen platform.
My Tip: feature the merchants in our rewards network prominently on your site, in your email and social media marketing, and in your conversations with customers.
Incentivize New Cardholders with Promotions
We have all been on a flight when the attendant announces on the PA system: “Sign up for our rewards card, as a new member, we will give you 100,000 miles free.” This is very purposeful. You must incentives new cardholders with promotions! Reward them for trying out your card program. Studies show that this tactic alone can lead to 2x more spending on your cards.
My Tip: offer large promotion to new customers, such as 25% off all purchases for a year, or 3-months free of a partner service. If has to be large to make a difference!
Utilize Crypto Rewards to Attract Younger Customers
Hydrogen allows customers to convert any rewards or promotions sent to cardholders from USD into popular cryptocurrencies, such as Bitcoin, Ethereum, and Doge! As I discussed in this article in TheNextWeb, this is an excellent way to make your rewards program stand out and attract younger and more engaged customers. Fintech startup BlockFi recently announced over 400,000 people joined the waitlist for their crypto rewards card!
My Tip: turn a boring cash back rewards program into something much more appealing by offering that a same cash back in an exciting new cryptocurrency asset. Which offer sounds better – 3% cash back on travel or 3% in BTC on every travel purchase?!
Make a Great First Impression
First impressions are lasting impressions! It’s vital that your first card users evangelize your brand (which I will cover shortly). You only have one shot to make your card program stand out. Make sure your customers clearly understand the value proposition of your card offering.
My Tip: spend a few dollars hiring a graphic designer to create beautiful marketing collateral for your rewards or loyalty offering. Consumers spend money with their eyes first!
Reward Customers for Referrals
Hydrogen’s innovative rewards infrastructure allows you to pay out bonuses to customers directly on the card. This payout happens instantly! Your customer doesn’t need to redeem anything. I highly recommend that you create a referral system, even if it’s informal. This will create a gamification element of your cards program and help you to scale it faster.
My Tip: put an extra $5-$25 on a customer’s card when they refer a friend or family member. Referral’s programs are key to building customer loyalty, not just with a cards program, but with your brand overall.
Partner with Merchants that Fit Your Brand’s Mission
Another great feature of Hydrogen’s rewards infrastructure is the ability for our customers to partner with businesses outside of our platform and create automated rules to disburse rewards from those partners! You will want to take advantage of this amazing feature by finding businesses that match your company’s ethos – e.g. ESG, female founded, non-profits.
My Tip: partner with a minimum of two businesses that match your brand’s identity. Have these partners give large and meaningful rewards to your cardholders – e.g. 10% off all purchases. This will help to build brand loyalty and affinity towards your mission.
Promote Hyper-Local Businesses
As mentioned above, our rewards infrastructure allows customers to offer rewards at the merchant level, this includes hyper-local offers from businesses in your neighborhood. Not only can this help out your small business community, but it can also build a sense of pride in your cardholders. Most consumers would rather spend money locally than with national brands!
My Tip: partner with a minimum of five local businesses that you believe in. Have these partners give large and meaningful rewards to your cardholders – e.g. 10% off all purchases. This will help to build brand loyalty and affinity towards your mission.
Give Rewards for Purchase Categories Whenever Possible
By now, we have all seen the new Kevin Hart commercials for the Chase rewards card, or Samuel ll Jackson for Capital One’s rewards card. They typically offer rewards on very specific categories – e.g. 5% cash back on travel, 3% cash back on dining. You don’t need to spend millions of dollars hiring celebrity spokesman to offer something similar! You can configure rewards for dozens of categories through our portal.
My Tip: use Hydrogen’s business intelligence suite to analyze your customers’ spend across categories over the first 3-months of your program. Even if you offer 5% cash back on travel, and 10% of all purchases are in the travel category, you will still breakeven with Hydrogen’s interchange payouts alone (you pay out 0.5% and earn 1% or more), not even taking into account large cash back deals for travel you can push through our rewards network!
Get Customer Feedback Early and Often
Lastly, we must reiterate how important it is for our customers to get feedback from cardholders. Ask them what they like and what they don’t like about your rewards offering. Provide this feedback to Hydrogen. We are your partner. Because of our innovative usage-based pricing model, when you succeed we succeed!
My Tip: send out a survey to your customers within the first 2-weeks of launching your rewards or loyalty program. Give customers gift cards for longer feedback sessions over video chat with you. This will not only help you to optimize your program, but it will also show that you care about customer feedback.
About the Author
Mike Ross Kane is the Co-Founder of Hydrogen, embedded finance simplified.
Mike works closely with customers to launch their programs. Reach out to Mike at any time for more tips!