A shopper buys once, the order ships, and that is usually the end of the relationship. Nothing about a completed checkout gives them a reason to think about you again next month. A points programme's real job is to install that reason - and it does it at four specific moments, not by existing on a page somewhere.
Why a Points Program Turns Shoppers Into Regulars
The mechanic is simple enough that it gets dismissed: a purchase produces a balance, the balance is worth money, and money left on the table is uncomfortable to walk away from. What makes it work is not the size of the reward but the fact that the shopper can see it. A balance sitting in a loyalty popup is a small open loop, and open loops get closed.
That is also why the mechanic fails when it is invisible. Points that only appear in a monthly email are points nobody remembers earning. The stores that get value out of a programme are the ones that put the number where the decision happens - a "you'll earn 120 points with this purchase" line next to the price on the product page, the same figure on collection cards, a balance in the popup on every page, and a reminder at checkout that there are unspent points sitting in the account.
A points balance is not a discount. It is an unfinished piece of business, and shoppers dislike leaving those unfinished.
The First Redemption Is the Real Conversion
Signing someone up is easy. The moment that decides whether they become a regular is the first redemption, because that is when the points stop being a marketing promise and start being real money off a real order. Everything between joining and that first redemption is friction to be removed: the minimum needed to redeem should be reachable from one or two orders, joining points should get them partway there on day one, and the discount code should land in the cart rather than in an inbox they have to go find.
Revenue contribution by loyalty mechanic, compounding over 12 months.
The Four Moments That Do the Work
- The first minute - a shopper joins with a phone number and a one-time code, and the welcome rewards fire immediately: joining points, a welcome coupon, free shipping or a free gift, plus the SMS or email carrying the code. If they placed a guest order in the last couple of days, MYLO credits those points retroactively, so the programme starts with a balance instead of a zero.
- The next visit - the balance is visible on every page, the product page shows what the current cart would earn, and if they reach checkout with points unspent, the redemption reminder asks whether they want to use them first.
- The quiet stretch - when a member goes cold, an SMS campaign can target exactly the people who have never redeemed a single point, or everyone above a balance threshold, and every link is tracked back to the orders it produced.
There is a fourth moment, and it is the one most programmes handle badly: expiry. If you set points to expire, MYLO warns the member in advance by SMS or email with a table of which points expire on which date, and spends the oldest points first so a recent purchase is never the one that evaporates. A deadline the member knew about is a reason to shop. A balance that silently disappeared is a support ticket and a lost customer.
Setting the Rules So the Maths Still Works
A points programme is a discount you are choosing to pay for on the second order rather than the first, so the rules should protect the margin. Set an earn rate per tier, a minimum order that qualifies, and, if you need it, a cap on how much of a single order earns. Set a minimum and maximum number of points per redemption and a minimum cart value to redeem at all, so the reward never lands on a basket too small to carry it. If some products cannot absorb the cost, give them their own earning rate - half points on clearance, none on gift cards. And decide whether points discounts stack with coupons and sale prices before the first promotion, not during it.
Then leave it alone. Points are awarded the moment an order is placed and reversed automatically if it is cancelled or refunded, promotions and rewards fire on their own, and every movement is logged with its source, the order reference and the balance before and after. What you should be watching on the dashboard is not points issued - it is points actually spent, and the share of your total store revenue coming from club members. The first number tells you people joined. The second tells you they came back.