Loyalty Program Examples: 12 Small Business Programs That Actually Work

Good loyalty program examples share three things: the customer gets the rule in one sentence, they can see their progress without effort, and the reward is within reach in a few months. Below are twelve programs from barbers, coffee shops, salons and shops that do exactly that, with the number of stamps, the reward, and the reason it works.

In short

• The stamp card is the most common form for small businesses, because it needs no explanation.
• Points, levels and memberships work better for businesses with bigger spends or fixed services.
• A program that lives in Apple Wallet or Google Wallet gets used more often than one with its own app.

Why a loyalty program works so hard for a small business

For a big chain, a loyalty program is a sum across millions of customers. For a hair salon, a coffee shop or a nail studio it is something else: it is the reason someone does not go to the competitor round the corner.

The numbers behind this are old, but still true. Research by Bain, published in Harvard Business Review, shows that keeping 5 percent more of your customers raises profit by 25 to 95 percent. That is because a returning customer costs nothing in advertising, spends more, and brings someone along more often.

There is a downside too. According to The Loyalty Report by Bond, the average shopper belongs to more than fifteen loyalty programs, but uses fewer than half of them actively. The ones that do get used are simple and visible. Those are exactly the two things the examples below were chosen for.

The four types of loyalty program

Before you read the examples, it helps to know the four types. Almost every program is one of these, or a mix.

| Type | How it works | Fits | Watch out for | |---|---|---|---| | Stamp card | A stamp per visit or purchase, a reward after X stamps | Barbers, cafes, ice cream shops, grooming salons, anything with a fixed product | Set the number of stamps to how often people visit | | Points system | Points per pound, redeemed for a discount or product | Shops, jewellers, salons with treatments from 40 to 200 | Keep the rate simple: 1 pound is 1 point | | Levels | Bronze, silver, gold based on visits or spend, each level with set perks | Gyms, wellness, restaurants with regulars | The gold level has to be reachable for a real customer | | Membership | A fixed monthly fee for a set service or discount | Beauty salons, massage studios, car washes, fitness studios | Make it cancellable monthly, or nobody will dare |

Coupons (a one-off discount or free product) are not a type of their own, but an add-on. A birthday coupon or a "we miss you" coupon works with all four.

Loyalty program examples by trade

1. The hairdresser: 8 cuts, the 9th free

A hair salon in a mid-size town gives a stamp per cut. After eight stamps, the ninth cut is free. Customers come roughly every six weeks, so the reward is within reach inside a year.

Why it works: the hairdresser is the classic business where a customer picks "whose chair" they sit in. The card lives on the phone, so it does not get forgotten. And the reward (a free cut worth 35) feels big, while across eight visits it is only about 11 percent off.

A version that also works: six stamps for a free wash or styling instead of a whole cut. Lower cost, faster to reach.

2. The coffee shop: 10 coffees, the 11th free

The best known of all loyalty program examples. Ten stamps, a free coffee. A coffee shop near a station uses this to win daily customers who would otherwise pop into a different place every other day.

Why it works: the frequency is high, so ten stamps is reachable in two weeks. The product is cheap, so the reward costs the shop around a pound. And the customer finishes the game, because they are close to ten.

What often goes wrong: paper coffee cards that vanish into a coat pocket. A coffee shop that switched to a digital coffee card in Apple Wallet and Google Wallet saw customers keep the card, because it sits next to their bank card.

3. The nail studio: 6 treatments, free nail art

A nail studio gives a stamp per gel treatment. After six stamps the customer gets free nail art worth 15 at their next appointment.

Why it works: customers come every three to four weeks, so six stamps is about half a year. The reward is something the customer really wants but would not normally book. And it mostly costs the studio time, not product.

4. The barbershop: cut and beard on separate cards

A barbershop runs two cards: one for cuts, one for beard trims. Both need six stamps. Customers who do both collect twice as fast.

Why it works: it turns the beard trim into its own product with its own reward. Customers who only came for a cut try the beard trim because they are "already collecting anyway". A stamp card for barbershops on the phone makes two cards just as simple as one.

5. The beauty salon: a membership at 49 a month

A beauty salon offers a membership: 49 a month for a monthly facial (normally 65) plus 10 percent off products. Cancellable monthly.

Why it works: the salon gets steady income and a full diary on quiet days. The customer comes every month, instead of "when it suits". This is the form that brings the most revenue per customer, but also the one that asks for the most trust. So: cancellable monthly, always.

6. The clothing shop: 1 pound is 1 point, 100 points is 10 off

A clothing shop gives a point per pound. At 100 points the customer gets a 10 credit. Points do not expire.

Why it works: the rate is so simple the customer knows it by heart. 10 percent off the next purchase is enough to bring them back, but not so much that the margin disappears. Twice a year the shop sends a message to everyone with more than 50 points: "you are halfway, double points this week".

7. The jeweller: levels with a real reward

A jeweller runs three levels: customer (0 to 500 a year), regular (500 to 2,000) and club member (above 2,000). Regulars get free batteries and cleaning, club members get a free repair each year and an invite to the private evening before Christmas.

Why it works: at a jeweller a stamp card is odd, because nobody buys ten rings. Levels reward the customer who spends a lot without giving discounts away on the jewellery itself. The rewards cost the jeweller little and feel exclusive.

8. The restaurant: a stamp per table, not per person

A restaurant gives a stamp per visit, no matter how many people. After five stamps: a bottle of wine of your choice at the next dinner. The restaurant also gives an extra stamp on Tuesday and Wednesday.

Why it works: the extra stamp on quiet nights moves visits to the days when the tables sit empty. The bottle of wine costs the restaurant 8 to buy, but feels like a gift worth 30. A stamp card for restaurants on the guest's phone can apply that Tuesday rule automatically.

9. The ice cream shop: a seasonal card with 8 stamps

An ice cream shop gives a stamp per visit from April to October. After eight stamps, a free ice cream with two scoops. In October the shop sends a message: "Two stamps to go, we close in three weeks."

Why it works: the season is short, so the card has a natural deadline. That deadline drives extra visits in September and October, exactly the months when takings dip.

10. The dog grooming salon: 6 grooms, the 7th half price

A grooming salon gives a stamp per groom. After six stamps the seventh is half price. Customers come every six to eight weeks.

Why it works: a whole free groom (60 to 80) is too dear to give away. Half price still feels like a real reward. And the card is in the dog's name, which owners love and talk about.

11. The fitness studio: a class pass as a loyalty card

A small yoga studio sells a ten-class pass. A stamp per class, and a free class after ten stamps. Anyone who does ten classes within three months also gets 10 percent off the next pass.

Why it works: the class pass is already normal at fitness studios. The extra reward for speed brings people to class more often, and coming more often is exactly what a studio needs to keep members. Read more about this form on the digital class pass page.

12. The car wash: a stamp card alongside the membership

A car wash has a membership for frequent washers, but most customers do not want a subscription. For them: a stamp card, the sixth wash free after five.

Why it works: the membership and the stamp card serve two kinds of customer. The stamp card is the way in; anyone who fills three cards in half a year gets a message about the membership.

What the good examples have in common

Read the twelve examples again and you will spot five patterns.

1. The rule fits in one sentence. "Ten coffees, the eleventh free." If you need a second sentence, the program is too complicated.
2. The reward is reachable within three to six months. Six to eight stamps for a hairdresser, ten for a coffee shop. Work it out from how often your customers visit.
3. The reward feels bigger than it costs. A bottle of wine, free nail art, a free cut: high value for the customer, low cost for the business.
4. The program steers behaviour. Extra stamps on quiet days, a deadline at the end of the season, two cards for two services.
5. The card is always to hand. The programs that work live on the customer's phone. Paper cards get lost, separate apps do not get installed.

How to choose the type for your business

Ask yourself two questions.

How often does a customer come? Weekly or more: a stamp card with 8 to 10 stamps. Every 3 to 8 weeks: a stamp card with 5 to 8 stamps, or a membership if the service is the same each time. A few times a year: points or levels.

How much does a customer spend each time? Under 25: stamps. Between 25 and 200: stamps or points. Above 200: points or levels, never stamps.

If you are not sure, start with a stamp card. It takes five minutes to make, customers get it right away, and you can always add points or a membership later. What it costs is on the pricing page; an overview of all the types is on the card types page.

Frequently asked questions

What is a good example of a loyalty program?

A good example is simple and quick: at a coffee shop the tenth coffee is free, at a hairdresser you get a free treatment after eight cuts. The customer gets it in one sentence, sees their progress on their phone, and reaches the reward within a few months. Programs that need explaining do not get used.

What types of loyalty programs are there?

Four types are most common for small businesses: the stamp card (a stamp per visit), the points system (points per pound), levels (bronze, silver, gold with set perks) and the membership or subscription (a fixed monthly fee for a set service). Coupons are an add-on to any of the four.

How many stamps should a stamp card have?

Between 6 and 10, depending on how often a customer comes. A coffee shop with daily customers can ask for 10 stamps, a hairdresser where people come every 6 weeks is better with 6 to 8. Rule of thumb: the customer should be able to reach the reward within 3 to 6 months, or they drop off.

What does a loyalty program cost for a small business?

A digital stamp card costs between 0 and 60 a month, depending on the number of customers and features. On top of that, count the value of the rewards themselves: with ten stamps and a free coffee worth 3, you give back 10 percent of that customer's spend. That is usually less than what winning a new customer costs.

Does a loyalty program work without an app?

Yes. A card that lives in Apple Wallet or Google Wallet needs no separate app. The customer scans a QR code, adds the card to their wallet, and sees their stamps there. Programs that require their own app lose a large share of customers at the download.

Want to try it yourself?

Pick one of the twelve examples, adjust the number of stamps to your customers, and put it live today. How to do that step by step is on the set up a loyalty program page. Start free, no app needed for your customers.

Want to try it yourself?

You can also try Beepify free right away and make your first card in a few minutes.