Did you know it costs 5 to 25 times more to get a new customer than to keep an old one? Crazy, right? But here’s the thing: many new Shopify store owners focus all their energy on getting new customers while ignoring the ones they already have.
Let me ask you this: what’s better—fighting for attention in a crowded market or keeping the customers who already love you? For me, it’s a no-brainer. Building loyalty is pure gold. Happy customers don’t just come back—they bring friends.
The secret? Two tools:
- A strong CRM system (Customer Relationship Management)
- A smart loyalty program
When these work together, they’re like a well-oiled machine, turning first-time shoppers into lifelong customers.
So, how do these tools work for you? Don’t worry—you’re in the right place. This article breaks it all down so you can build connections that last.
CRM and Loyalty Programs: The Key to Better Customer Relationships
Customer relationships are the heart of every business. If you want to succeed, you need to connect with your customers and keep them coming back. That’s why CRM systems and loyalty programs are so important. They help you understand your customers, keep them happy, and build loyalty over time.
Here’s how these tools can help you:
What is CRM?
CRM stands for Customer Relationship Management. It’s a tool that helps you:
- Organize customer info like names, emails, and purchase history.
- Track interactions to know how customers engage with your store.
- Learn their preferences so you can offer what they want
Think of it as your customer cheat sheet. Have you ever needed help remembering which customer loves what product? A CRM takes care of that for you.
How CRM Helps You Understand Your Customers
A good CRM system isn’t just for keeping things organized—it helps you truly understand your customers. Here’s how:
- Personalize your communication: Address your customers by name, recommend products they might like, and send them tailored offers based on their past purchases.
- Segment your audience: Group customers based on their demographics, purchase history, or engagement levels so you can send targeted marketing campaigns that are more likely to resonate.
- Track customer interactions: You can see which products they’ve viewed, what they’ve added to their cart, and how they’ve interacted with your emails or social media posts to understand their journey and identify areas for improvement.
- Provide better customer support: With customers’ purchase history and past interactions in hand, you can provide more personalized and efficient support.
What Is a Loyalty Program?
A loyalty program is your way of saying “thank you” to your customers. It’s a system that rewards them for sticking with your store. Think points, discounts, or exclusive perks. These little rewards can make a big difference.
How Loyalty Programs Are Vital for Retention
Loyalty programs aren’t just nice extras—they’re a must-have for keeping customers. Here’s why:
- They make customers feel appreciated. When people feel valued, they’re more likely to stick with your brand.
- They give customers a reason to return. Points or perks make shopping more fun and rewarding.
- They build a community. A good loyalty program connects your customers to your brand on a deeper level, making them feel like they’re part of something special.
- They give you insights. By tracking rewards and purchases, you can learn what your customers love and improve your marketing or products.
How CRM and Loyalty Programs Work Together
When you combine CRM and loyalty programs, you create a system that helps you understand your customers and reward them in meaningful ways. They’re like two sides of the same coin—powerful on their own but unstoppable together.
Here’s how they complement each other:
- CRM as the Data Hub: Your CRM system acts as the central hub for collecting and organizing customer data.
- Loyalty Programs as the Action Engine: Loyalty programs take that valuable customer data and use it to create targeted and personalized experiences.
How To Build Lasting Customer Relationships With CRM And Loyalty Program: Expert Advice
Alright, let’s get down to brass tacks and build a customer relationship strategy that works:
The infographic above highlights six steps to building lasting customer relationships. Below, we’ve grouped these into three main stages:
Step 1: Implement a Robust CRM System
First things first, you need a solid CRM system to be the backbone of your strategy. but some of the top-of-mind ones for Shopify stores include:
- Shopify’s built-in CRM: It’s free and gives you a basic overview of your customers.
- HubSpot: A popular all-in-one marketing and CRM platform.
- Zoho CRM: A powerful and customizable CRM with many features.
- Salesforce: A leading CRM for larger businesses with advanced needs.
- Salesflare: A well-trusted CRM for B2B businesses
Choose a CRM that fits your budget and needs, but make sure it integrates seamlessly with your Shopify store.
Step 2: Use Data From The CRM to Design an Engaging Loyalty Program
Once your CRM is up and running, use the insights to create a loyalty program that resonates with your customers. Tailor your rewards to their behavior and preferences for maximum impact.
Here are a few examples:
- Abandoned cart data: Reports show that 70.19% of online shopping carts are abandoned, and your store is facing the same issues, and you want to reduce this loss.
- CRM Data: Leveraging CRM data, many customers abandon their carts right after adding items over $100.
- Loyalty Program: Send an email with all their cart items, offering an extra 10% loyalty points or free shipping if they complete the purchase within 24 hours.
- Engaging Lapsed Customers
- CRM Insight: A segment of customers hasn’t purchased in over 6 months, and you want them to return to the store.
- Loyalty Incentive: Provide a “Welcome Back Bonus” of $10 worth of loyalty points, free shipping, or extra gifts if they purchase within 7 days of receiving a re-engagement email.
- Feedback
- CRM Insight: Customers who leave reviews or complete surveys are more engaged but account for only 10% of the database.
- Loyalty Incentive: Reward points for every verified product review or completed survey within 7 days of purchasing.
Step 3: Monitor and Optimize
A loyalty program isn’t a “set it and forget it” project. You need to track how it’s doing and adjust based on your CRM insights.
For example:
If birthday rewards are a hit but referral bonuses fall flat, double down on birthday offers and rethink your referral system.
All Shopify loyalty apps, including Joy Loyalty, have built-in analytics that add valuable insights to your CRM stats, allowing you to refine your campaigns further.
An Example Of Successful Loyalty Programs and CRM Implementation: Starbucks Rewards
Starbucks is an excellent example of how combining CRM tools with a loyalty program can build strong customer relationships. Here’s how they did it:
1. Listening to Customers
In 2008, Starbucks launched “My Starbucks Idea” (powered by Salesforce). It allowed customers to:
- Share their ideas for new products and improvements.
- Vote on suggestions from other customers.
This tool helped Starbucks focus on what customers actually wanted. It also strengthened their connection with the brand by making customers feel heard.
2. Launching My Starbucks Rewards
In 2009, Starbucks introduced My Starbucks Rewards, a loyalty program designed to keep customers engaged. Members earned Stars with every purchase and unlocked perks as they climbed through tiers:
- Green Level: Free in-store refills and birthday treats.
- Gold Level: Reached after 300 Stars in a year, offering free food and drinks.
The program rewarded frequent shoppers while encouraging them to spend more.
3. Enhancing with Mobile Integratio
Customers started suggesting mobile payment systems through My Starbucks Idea, and Starbucks listened. They upgraded their app and integrated it with the Rewards program. Now, customers could:
- Earn and track Stars directly in the app.
- Receive personalized offers and recommendations based on their shopping habits.
4. Adapting Based on Data
By 2016, Starbucks used spending data to improve the Rewards program. They moved from a visit-based system to a spend-based model, offering: Two Stars for every dollar spent
This change rewarded high-spending customers more fairly, keeping them loyal while still motivating others to spend more.
Why It Worked:
- Listening to customers through feedback tools.
- Using data insights to refine their programs.
- Personalizing offers to make customers feel valued.
Combine CRM and Loyalty Programs with Joy – Loyalty Program for Shopify
Building strong customer relationships isn’t always easy, but combining CRM systems with loyalty programs makes it much simpler. Here’s how:
CRM systems help you collect important customer data, like what they buy and how they interact with your store.
Loyalty programs take that data and turn it into rewards your customers love, like discounts or exclusive perks.
Together, they’re a powerful team that can completely change how you connect with your customers. Look at Starbucks’ My Starbucks Rewards program—it’s proof that using these tools together can lead to massive success.
So, how can you do the same for your Shopify store?
With tools like Joy Rewards & Loyalty Program, it’s easy to get started. You can:
- Use CRM insights to create tailored rewards for your customers.
- Track customer activity to understand their behavior.
- Deliver personalized offers that keep them coming back.
