Loyalty programs can be invaluable for brands — when used correctly. L2’s Loyalty report lists several common mistakes among companies that deploy them.

Don’t: Make it hard to sign up

The Nautica Rewards hub is completely disconnected from the brand’s main site. Visit the Nautica homepage or sign up for an account, and you won’t see the loyalty program mentioned. To find a link to the hub, you need to scroll all the way to the bottom of certain site pages. This limits discoverability: the rewards microsite receives less than 2% of total brand site traffic. Even worse, shoppers who do make it to the site are required to create a new password beyond their pre-existing brand site login, isolating the loyalty program experience even further.

Nautica

Don’t: Fail to advertise

Macy’s is generally a consistent communicator via both email and SMS. However, the brand fails to leverage these communication channels to advertise its loyalty program, Plenti, a multi-brand coalition loyalty program also used by Rite Aid and American Express. The retailer’s welcome email does not mention Plenti; even when users sign up for the program, subsequent emails focus heavily on discounts rather than loyalty offers. Confusingly, emails specifically about the program come directly from Plenti and do not mention Macy’s at all. The retailer’s text messages also fail to mention the program, instead sending generic “Promo Alerts.”

Don’t: Ask for data without an explanation

When customers sign up for its loyalty program, The Body Shop asks them to supply eight data points including birthday, phone number, and address without explaining how this information will be used. Additionally, the link to the program’s privacy policy is broken. Requesting information without explaining its purpose can alienate consumers, making them less likely to supply their personal data and limiting program signups.

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