Loyalty
Points
Loyalty Points
A virtual currency earned through purchases or activities that can be redeemed for rewards, discounts, or products.
What is Points?
Points are the currency of loyalty programs. Customers earn points for actions and redeem them for rewards.
Earning points:
- Purchases (1 point per $1 spent)
- Account creation
- Reviews
- Social shares
- Referrals
- Birthday bonuses
- Engagement activities
Redemption options:
- Dollar-off discounts
- Percentage discounts
- Free products
- Free shipping
- Exclusive experiences
- Charity donations
Points program design:
- Earn rate: How quickly points accumulate
- Burn rate: Point value when redeemed
- Expiration policy
- Minimum redemption thresholds
Formula
Point Value = Redemption Value ÷ Points Required
Example
If 100 points = $5 discount, each point is worth $0.05.
Why Points Matters
Points create gamification and give customers tangible progress toward rewards.
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