Loyalty reward ideas: give from your menu, not a discount

Why give something from your menu instead of a discount?

A discount is a number off the bill. A free item is something the customer can picture. "A free flat white" is easy to want. "Money off your next visit" is easy to forget.

There are a few practical reasons to prefer a menu item:

• It costs you less than it is worth to the customer. A free coffee costs you the beans, the milk and a minute behind the machine. To your customer it is worth the full price.
• It feels like a gift. A discount can quietly suggest your normal price is too high. A free item says thank you for coming back.
• It brings them back to you. The reward can only be collected in your shop, from your counter, by your staff.
• It does not teach people to wait for deals. Regulars come for your coffee or your cut, not for the next offer.

If you want to read more about keeping regulars without cutting prices, see customer retention without discounts.

What makes a good loyalty reward?

A good reward is simple enough to explain in one sentence at the counter. Check yours against this list:

• One clear item. Write it the way you would say it: "A free coffee of choice", not "one complimentary beverage".
• Something regulars already buy. If most people order a cappuccino, a free cappuccino means more to them than a free herbal tea.
• No small print. "A free small filter coffee before 11:00 on weekdays" turns a thank you into a rule.
• Easy to hand over. Staff should be able to give it without checking anything or asking a manager.
• Affordable for you. You give it away again and again, so it has to make sense at your cost price.

A little choice helps. "A free coffee of choice" or "a free loaf of your choice" lets the customer pick their favourite without making the reward vague.

Which loyalty rewards suit your type of shop?

The table below shows a reward and number of stamps per type of business, taken from example cards, plus another idea from the same menu. Treat them as starting points.

A few notes on choosing between the two columns:

• Service businesses such as barbers and salons give away time, not stock. A free cut is generous, so cards there tend to have fewer stamps. See the full example for barbers and for salons and nail studios.
• Food and drink can give the item itself. A free coffee is easy to hand over in a busy queue, which is why it suits a coffee bar so well.
• Gyms and studios can use the reward to invite someone new. "A free class for a friend" thanks the regular and lets a friend try you out. More on the gym stamp card.
• Clinics should keep the card plain. A Usuals card for a clinic shows only the first name, the stamps and the reward, and no medical data goes on the card.

How much does a menu reward really cost you?

Work it out with your own numbers, in visits rather than in percentages.

Take a coffee bar with a 10 stamp card and a free coffee as the reward. The customer pays for ten coffees and then gets one free. So you give away one coffee for every ten you sell. And you give away what that coffee costs you to make, not what you charge for it.

Welcome stamps change the sum a little. With 2 welcome stamps at sign up, a new customer pays for eight coffees before the card is full. For a regular on their second or third card, it is back to ten.

A simple way to check your own reward:

1. Write down what the reward item costs you to make or do.
2. Divide it by the number of paid visits needed to fill the card.
3. That is what each visit on the card costs you. Ask yourself whether that feels fair for a regular.

If the number feels too high, pick a smaller item or add a stamp or two. If it feels very low, the reward may be too modest to notice. The loyalty card calculator helps you work out what an extra visit per regular is worth and suggests a reward you can afford. For the stamp count itself, read how many stamps before a reward.

Which rewards should you avoid?

Some rewards look generous on paper but cause trouble at the counter:

• Money off the whole bill. Hard to picture, and it shrinks the till on exactly the visit when the customer is spending.
• Rewards with conditions. Time slots, minimum spends or "selected items only" lead to awkward conversations.
• Things you do not sell. A branded mug nobody asked for or a voucher for another shop does not bring anyone back to you.
• A reward that is too far away. If the card looks endless, people stop collecting.
• A reward much bigger than the usual visit. A salon card for haircuts with a free colour treatment as the reward will be hard to keep up.

How do you put the reward on a digital card?

On a Usuals card you choose the reward, the number of stamps and your colours when you set up the card. A card has 6 to 12 stamps until the reward, plus 0 to 3 welcome stamps at sign up.

The card in Apple Wallet or Google Wallet shows the reward next to the stamps so far, for example 7 / 10. Your customer can see what they are collecting for every time they open their Wallet.

When the card is full, the reward is ready and shown on the card. Staff scan the card and tap "Redeem reward". The stamps for that reward come off, any extra stamps stay, and your customer keeps collecting.

If you change the reward later, the change reaches every existing card by itself. It is still kind to tell your regulars at the counter before you do.

How do you start?

1. Write down the three items your regulars buy most often.
2. Pick the one with a cost price you are comfortable giving away, and write it as you would say it.
3. Choose the number of stamps and check the sum with your own numbers.
4. Try it out in the free stamp card maker and see how the reward looks in Apple Wallet and Google Wallet. If you still want paper cards for now, the printable stamp card gives you a PDF with your name, logo and colour.
5. Create your card in Usuals, print the A4 poster with your logo, reward and QR code, and put it by the till.

Usuals is free up to 30 customers. Starter is €29 per month, excl. VAT, and Business is €49 per month, excl. VAT. All plans are on the pricing page.