Building Customer Loyalty Platforms Can Support E-Commerce Businesses

Building customer loyalty isn’t just about making your e-commerce buyers feel appreciated—it’s about creating a well-oiled engine that powers higher revenues, repeat purchases, and long-term business growth. If your brand is constantly churning through customers without retention, it’s like pouring water into a leaky bucket, ignoring crucial customer behavior insights. Sure, you might make sales, but you’re constantly replacing lost customers instead of nurturing existing ones for sustainable profitability.

Smart marketers know that keeping customers is far more cost-effective than acquiring new ones. Studies consistently show that returning customers spend more and shop more frequently, making them far more valuable in the long run.

With the right loyalty platform, you can turn first-time buyers into lifelong customers while maximizing profitability. But how exactly does customer loyalty impact your bottom line? Let’s break it down.

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The Bottom-Line Impact of Customer Loyalty

We know it sounds like a broken record, but acquiring new customers is significantly more expensive than retaining your existing customers. And yet, many brands continue to pour money into acquisition without an effective strategy to retain and nurture those hard-earned customers.

Our partner, Shopify, recently reported that acquiring a new customer can cost as much as $377. That’s an eye-watering number when you consider that a single transaction may not even cover that cost. If you’re not maximizing the value of that customer over time, you’re essentially lighting your marketing budget on fire.

Leveraging customer data allows brands to create personalized experiences that drive repeat purchases and long-term loyalty.

This is why customer lifetime value (LTV) is the true north star of profitability. Brands that build loyalty see increased purchase frequency, higher spending per transaction, and a reduction in costly customer churn.

This is where a strong loyalty platform software and rewards program platform come in. These tools provide customers with incentives—whether it’s exclusive discounts, points-based rewards, or VIP perks—that keep them engaged and eager to shop with you instead of your competitors.

The best part? Loyalty programs don’t just improve retention; they also encourage customers to spend more each time they shop.

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Increasing Average Order Value (AOV)

Loyalty programs aren’t just about getting customers to return—they actively drive higher spending per transaction by aligning with customer preferences. Our data shows that e-commerce businesses with established loyalty programs see an average 15% increase in average order value (AOV).

But why does this happen?

1. More Items Per Cart – Customers in loyalty programs often add more products to their cart than non-members. This could be due to points-based incentives, discounts on bundled items, or special promotions offered exclusively to members.
2. Higher Cart Values – Shoppers enrolled in a loyalty platform software tend to spend more per transaction because they want to maximize their rewards. A customer who might normally spend $50 per order may increase their spending to $75 to hit a rewards threshold.

For example, if a retailer offers double points on purchases over $100, customers are incentivized to increase their spending to reach that milestone. This not only benefits the shopper (who earns more rewards) but also directly boosts revenue for the business.

It’s a win-win—the customer gets a better deal, and the business gets a higher transaction value.

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Encouraging Frequent and Repeat Purchases

Customer loyalty isn’t just about how much people spend—it’s also about how often they shop with you. Understanding the customer journey allows brands to create touchpoints that encourage repeat purchases and long-term loyalty.

Our data shows that e-commerce brands with rewards program platforms experience nearly 2x the purchase frequency from enrolled customers compared to those who don’t participate.

This behavioral shift happens because a well-structured loyalty platform software creates a habit-forming loop. Customers are naturally drawn back to brands where they feel valued and rewarded.

Here’s how brands keep engagement high:

• Personalized Offers – Sending individualized deals based on shopping behavior keeps customers coming back for more.
• Reminder Emails – A simple reminder about unused points or expiring rewards can nudge customers toward another purchase.
• VIP Access – Providing early access to sales or new product launches makes members feel special and more likely to return.

Think of your loyalty program like a frequent flyer program for your e-commerce store. When customers know they’re working toward a bigger reward, they’ll choose you over competitors time and time again.

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Reducing Customer Churn and Improving Customer Retention

Customer retention is crucial because losing customers is costly—not just in revenue, but in the wasted effort spent acquiring them in the first place.

The average churn rate for e-commerce businesses ranges from 8% to 9.7%, according to Statista. If you can beat that benchmark, you’re immediately setting yourself apart from competitors who struggle with retention.

A strong loyalty platform helps prevent churn by keeping customers actively engaged with your brand. Features like gamification, milestone rewards, and VIP perks make customers feel like they have something to lose by walking away.

For example, if your rewards program platform has tiered membership levels (Silver, Gold, Platinum), customers are more likely to keep shopping to maintain their status. No one wants to lose out on perks they’ve already earned.

Reducing churn is about making it painful for customers to leave—not in a bad way, but by making the benefits of staying so great that they wouldn’t dream of shopping elsewhere.

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Increase in Customer Lifetime Value (LTV)

We’ve covered a lot of ground—higher order values, increased purchase frequency, and reduced churn. All of this ladders up to one crucial metric:

Customer Lifetime Value (LTV).

Monitoring program performance is essential to understand how loyalty initiatives contribute to increased customer lifetime value.

The formula is simple:

Higher AOV + More Purchases + Lower Churn = Increased Customer LTV

When we analyzed our e-commerce clients’ data, we found that businesses that implemented a loyalty program software saw up to an 81% increase in customer lifetime value.

That’s massive.

If you could increase the total revenue from each customer by 81%, how much would that impact your business?

This is why loyalty programs are no longer just a nice-to-have. They’re an essential piece of your revenue strategy.

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Final Thoughts

Investing in a customer loyalty platform is a “no-duh” decision for marketers looking to drive the most ROI from their ecommerce channels. With the driving costs to acquiring new customers, it might be the only decision available to increase ROI.

By leveraging loyalty platforms, you can:

✔️ Increase average order value

✔️ Drive more frequent purchases

✔️ Reduce customer churn

✔️ Increase overall customer lifetime value

The result? A thriving, profitable e-commerce business with a loyal customer base fueling sustainable growth.

Ready to turn customer loyalty into higher ROI? Book a demo today and start driving more value from your acquisition efforts.