Loyalty programs are a great way to retain customers and increase revenue. However, to ensure the success of your loyalty program, it’s crucial to track key performance indicators (KPIs). If you’re unsure of exactly which customer loyalty KPIs to track, we have you covered.
One of the most important KPIs for loyalty programs is the customer retention rate. This is the percentage of customers who continue to do business with your company over a given period. A high customer retention rate means that your loyalty program is effectively incentivizing customers to keep coming back, which can lead to increased revenue over time.
Customer lifetime value is the estimated total amount of revenue a customer will generate throughout their relationship with your business. Keeping an eye on the CLV helps identify high-value customers and tailor your loyalty program to meet their needs.
Net Promoter Score measures customer satisfaction and loyalty by asking customers how likely they are to recommend your business to others. A high NPS score means that your loyalty program is effectively engaging and satisfying customers, which can lead to increased referrals and revenue.
Customer churn rate measures the percentage of customers who stop doing business with your company over a given period. By tracking churn rate, you can identify areas of your loyalty program that may need improvement and take steps to retain customers.
Redemption rate measures the percentage of loyalty program rewards or points that are redeemed by customers. A high redemption rate means that your loyalty program is effectively incentivizing customers to take action and engage with your business. This is a critical measure of loyalty program success.
Average Order Value measures the average amount of money customers spend per transaction. By monitoring AOV, you can identify opportunities to upsell or cross-sell to customers, which can increase revenue and customer lifetime value.
Engagement rate measures the level of customer interaction with your business’s loyalty program, such as how often they log in or participate in program activities. This can be based on any type of interaction offline, online, on mobile, social, or even in augmented reality. By monitoring your program’s overall engagement rate, you can identify areas that may need improvement and take steps to stimulate more customer engagement.
Customer acquisition cost measures the cost of acquiring a new customer, including marketing and advertising expenses. You can use this to identify the most effective marketing channels and tactics to acquire new customers, which can increase revenue and customer lifetime value.
Repeat purchase rate is an important KPI for loyalty programs. It measures the percentage of customers who make more than one purchase from your business. By tracking repeat purchase rates, you can identify opportunities to encourage customers to make additional purchases, which can increase revenue and customer lifetime value.
Referral rate measures the percentage of customers who refer others to your business, which can be an indication of their loyalty and satisfaction with your company. Tracking this loyalty KPI helps you identify opportunities to incentivize customers to refer others, which can increase referrals and revenue.
And there you have the most important loyalty program KPIs. Tracking your success shouldn’t be time-consuming. If your loyalty software doesn’t make KPI reporting easier, it might be time to switch.
m–wise Loyalty Cloud comes with dedicated KPI reports and built-in Insights that make every aspect of loyalty program management a breeze. With a system that helps you continually monitor and optimise your program, you’ll be on your way to long-term loyalty in no time.