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Loyalty Marketing Glossary

A loyalty marketing and retention glossary of terms for ecommerce and omnichannel retail brands explaining some of the most commonly used terms and phrases.

A

Acquisition

The strategic process of attracting, engaging and converting new prospects into paying customers.

Automation

An automation is a workflow that can be executed with minimal to no Admin intervention. Example, loyalty points which are automatically credited to a customer account after a purchase.

Accrual Rate

The rate at which customers earn points or rewards based on their actions typically spend.

Activation Campaign

A campaign designed to convert new users into engaged loyalty members.

Loyalty API

A system that allows loyalty features to connect with platforms like Shopify or POS systems.

Average Order Value (AOV)

The average amount spent per transaction used to measure purchasing behaviour.

B

Behavioural Segmentation

Grouping customers based on similar actions/ behaviours like purchases, visits or engagement.

Behavioural Triggers

Triggers based on user actions and purchasing behaviours.

Bonus Points Campaign

A promotion offering loyalty points incentives for specific actions or purchases.

Brand Loyalty

A customer’s consistent preference for a brand driven by trust and experience.

Burn Rate (Points Burn Rate)

The rate at which customers redeem their earned loyalty points.

C

Campaign Attribution

Tracking which campaigns drive results.

Campaign Trigger

An automated action initiated by a customer behaviour such as a purchase or signup.

Cashback Loyalty

A loyalty model where customers receive a percentage of spend back as credit which can be used on future purchases.

Churn Rate

The percentage of customers who stop engaging or purchasing over time.

CLV (Customer Lifetime Value)

CLV is a prediction of the total business value derived from a customer relationship based on their current spending habits and their lifespan.

Conversion Rate

The percentage of users who take a desired action such as sign up or purchase.

Cross Channel Campaigns

Campaigns running across multiple platforms.

Customer Activation Rate

Percentage of users engaging & making their first transaction after signup.

Customer Data Platform (CDP)

A system that unifies customer data across channels under a unified customer profile.

Customer Engagement

The level of interaction and emotional connection customers have with a brand.

Customer Journey

The full experience a customer has with a brand across all touch points.

Customer Lifecycle Automation

Automated engagement across the entire customer journey

Customer Loyalty Program

A system designed to reward repeat behaviour and increase retention.

Customer Profile (Unified Profile)

A single view of a customer combining data & behaviour across all channels.

Customer Retention

The ability to keep customers returning & making purchases over time.

Customer Segmentation

Dividing customers into groups based on pre-defined & shared characteristics or behaviour.

D

Data Driven Marketing

Using customer data & behaviour to personalise marketing campaigns and offers.

Data Enrichment

Enhancing customer data with additional attributes made available through Apps.

Demographic Segmentation

Grouping customers by age and gender, or by location using a manual tagging workaround.

Digital Loyalty Card

A virtual version of a loyalty card.

Discount Incentive

A reward offering reduced price to encourage purchase.

Dynamic Customer Groups

Automatically updated customer groups based on real time behaviour in line with the rules of the group.

E

Earn Rules

Defined actions that determine how customers earn rewards.

Earning Ratio

The relationship between spend and points earned.

Ecommerce Loyalty Strategy

Approach to retaining customers in online retail.

Emotional Loyalty

Emotional loyalty is an emotional attachment to a brand driven by trust, recognition, and shared identity.

Engagement Rate (Loyalty)

Frequency of interaction with loyalty program.

Event Based Trigger

An automation triggered by a specific event such as birthday or purchase.

Experiential Rewards

Non monetary rewards like VIP access or exclusive events.

F

First Party Data

Data collected directly from customers through owned channels.

G

Gain Rate

The rate at which customers earn points or rewards based on their actions; typically spend.

Gamification

Using game mechanics such as points, levels and badges to drive customer engagement.

Geo Targeting

Targeting customers based on geographic location.

H

High Value Customers

Customers generating the most revenue or engagement.

I

In Store Loyalty

Loyalty engagement happening via physical retail or POS.

Incentive Marketing

Using rewards to incentivise customer behaviour.

Integration (Shopify Integration)

Connecting loyalty systems with e-commerce platforms.

 

L

Lifecycle Marketing

Marketing based on customer stage such as new active or dormant.

Loyalty Automation

Automated campaigns triggered by customer behaviour.

Loyalty Campaign Builder

Tool used to create and manage loyalty campaigns automatically.

Loyalty Currency

The unit of value in a loyalty program such as points or credits.

Loyalty Management System

Software used to manage loyalty programs.

Loyalty Personalisation Engine

Technology enabling dynamic personalised rewards.

Loyalty ROI

Return on investment from loyalty programs.

Loyalty Tier

Levels within a program offering increasing rewards.

Loyalty Wallet

Digital storage for rewards and points.

M

Marketing Automation

Technology that automates campaigns and messaging.

Micro Segmentation

Highly specific customer segmentation groups.

Multi Channel Marketing

Marketing across multiple platforms without full integration.

N

Net Promoter Score (NPS)

A metric measuring customer satisfaction and likelihood to recommend.

O

Omnichannel Customer Experience

Seamless interaction across all customer touchpoints; points of sale, online and in store.

Omnichannel Loyalty

A unified loyalty experience across online and offline channels whereby customers can earn and redeem loyalty incentives across all channels.

P

Points Based Loyalty Program

A loyalty system where customers earn and redeem points.

Points Expiry

Rules defining when points become invalid and can no longer be redeemed.

Points Redemption

The process of customers using the app at the cash point to redeem points or use coupons.

POS Loyalty Integration

Connecting loyalty systems with in store checkout.

Predictive Analytics

Using data to forecast customer behaviour.

Predictive Segmentation

AI based grouping of customers based on predicted future behaviour.

Promotion Campaign

A time based marketing initiative offering incentives or special offers.

Promotion Stacking

Combining multiple discounts or rewards.

Purchase History Targeting

Targeting customers based on past purchases.

R

Reactivation

Customer reactivation is a process or strategy designed to engage customers who have been inactive for some time. This can sometimes be referred to as a “win back” campaign such as limited time offers, news & updates, seasonal greetings and many more.

Real Time Segmentation

Segmentation updated instantly based on behaviour.

Referral Program

Rewarding customers for bringing in new customers.

Repeat Purchase Rate

The frequency of customers returning to buy again.

Retention Rate

Retention Rate is the percentage of customers retained over time.

Return on Investment (ROI)

Return on investment is a financial ratio that measures the profit generated by an investment relative to its cost.

Reward Catalog

A list of available rewards within a loyalty program.

Reward Tiering

Structuring rewards across different levels.

S

Segmentation Engine

System that creates and manages customer segments.

Shopify Customer Profiles

Customer data stored within Shopify used for targeting.

Shopify Loyalty Program

A loyalty system integrated directly into Shopify stores.

Shopify Omnichannel Marketing

Unified marketing across Shopify online and in store channels.

Shopify POS Loyalty

Loyalty integrated with Shopify in store POS system managed from the Shopify Admin.

SKU Based Targeting

Targeting customers based on specific products purchased.

Smart Triggers

Advanced automation based on multiple conditions.

Social Engagement Rewards

Rewards for social actions like sharing or reviews.

Subscription Loyalty Program

Loyalty tied to paid membership.

Surprise and Delight Marketing

Unexpected rewards to increase emotional loyalty.

T

Tier Progression

Movement between loyalty levels based on behaviour or pre-defined rules for each level.

Transactional Data

Data generated from purchases.

Transactional Loyalty

Transactional loyalty is incentive based loyalty. Customer engagement & purchases are driven by discounts, promotions or limited time offers, etc.

U

Unified Commerce

Fully integrated retail system across channels both online and in store.

Unified Customer View

A complete single view of customer data including profile, historical transactions and participation in loyalty programs, points balances, etc

Upsell Incentives

Rewards designed to increase the order value

User Generated Content (UGC)

Customer created content used in marketing.

W

Win Back Campaign

Campaign targeting inactive customers to incentivise engagement and purchases.

Wallet Pass (Apple Google Wallet Loyalty)

Digital loyalty cards stored on mobile devices used at checkout to earn & redeem loyalty rewards.