Loyalty Blogs

How to Integrate Sustainability & Social Responsibility into Your Loyalty Program?

  • Posted on December 8, 2023 by Robert
  • Reading time about 6 minutes
loyalty program

A loyalty program is becoming an essential part of every business to win customers’ hearts & retain them for a long time. Over the years, loyalty programs have evolved tremendously, and integrating sustainability and social responsibility is becoming important to consumers.

Many brands have already started integrating these values into their loyalty programs, which incentivizes customer loyalty and promotes eco-friendly practices along with social causes. However, brands often find it difficult to understand the complexity, and challenges of building a reward system around sustainability or social responsibility.

Before you invest in the right Loyalty Management Software, you must check out how you can reward sustainability and social responsibility through your loyalty program.

Do Customers Care About Sustainability in Loyalty Programs?

If your brand is wondering if customers care about sustainability, then you must check out this section. Recent studies have found that there has been a higher number of customers who care about sustainability though customers’ attitudes towards sustainability may vary from one another.

Experts also noticed that customers’ actions may not always align with their values. For instance, they may say they care about sustainability but end up buying products from brands that have poor environmental practices. This happens because of factors like pricing, convenience, and lack of awareness.

An IBM study conducted in 2022 says that there is still a gap between the intention of customers and their actual buying behavior even though it was found that customers are increasingly becoming more active in supporting sustainable brands. Additionally, in a similar report, 62% of customers say they are ready to switch their purchasing habits to reduce environmental impact and half of them are happily willing to pay a premium for sustainability.

So, the conclusion is that an increasing number of customers are now prioritizing sustainability & social responsibility while making their purchase decisions from brands. This means, brands must incorporate sustainability elements into their programs to attract and retain customers sharing these values.

Which Brands Must Reward Sustainability Through Their Loyalty Programs?

Many brands are inclined to reward sustainable and socially responsible activities for their business. For instance, brands producing a high volume of waste like fast food companies may be more excited to build loyalty programs that incentivize recycling and waste reduction.

Talking about the brands whose core products are sustainable offerings like outdoor clothing or eco-friendly products, they may build a loyalty program that promotes circular fashion models or environmentally friendly packaging which will go well with the brand offerings. Also, brands that focus on social responsibility may create loyalty programs supporting social causes or community engagement.

When you build a Loyalty rewards program for small businesses or big brands, it is important to ensure that the inclusion of sustainability or social responsibility in the loyalty program does not seem tokenistic. The elements of sustainability and social responsibility should be included in the loyalty program in such a way it is complementary to the brand’s core offerings.

Tips to Incorporate Sustainability into Loyalty Programs

While rewarding sustainability and social responsibility through your loyalty programs, it is crucial to keep a balance between providing a suitable level of reward and ensuring commercial and operational feasibility. Make sure that you design a program that rewards customers for sustainable behaviours without compromising under financial viability of the business.

A few factors must be considered while incorporating sustainability into your loyalty programs such as rewards costs, redemption frequency, and impact of profitability. Before building a program that is based on sustainability goals, ensure that you conduct thorough market research, analyze behavior, and understand any financial challenges. This will help in building a program that not only motivates your customers to engage in sustainable actions but also contributes to long-term success & business growth.

Here are some examples of successful brands that have added sustainability & social responsibility into their loyalty programs-

1. H&M Conscious

This program by the H&M brand rewards customers for recycling their clothing where program members get discounts on future purchases for the items, they bring into the store for recycling. This program boosts environmental responsibility.

2. Levi’s SecondHand

This loyalty program by Levi’s promotes environmental responsibility by encouraging them to bring in used Levi’s clothing for resale. The members get exclusive discounts & early access to sales.

3. Ecosia Tree-Planting Program

Ecosia is a search engine that believes in planting trees around the world using their profits. Users will earn points just for using Ecosia for their normal online searches, thereby helping in reforestation efforts.

4. GreenUP

This mobile app is focused on tracking customers’ carbon footprints while encouraging them to reduce through sustainable activities like using a bike to go to the workplace or reducing energy waste at home. For these activities, they earn points that can be redeemed letter for discounts or rewards, thereby increasing customer engagement & environmental responsibility.

5. Grill’d

This Australian burger chain, Grill’d has a loyalty program known as the “Local Matters” program, which promotes community engagement. In this program, customers can vote for a local community each month to receive a donation from the brand.

6. Patagonia Worn Wear

This outdoor clothing brand, Patagonia has a loyalty program that is focussed on sustainability where they motivate customers to bring in their used Patagonia clothes for recycling or repair & earn store credit for the same. This helps to promote environmental responsibility.

Closing Statement

After going through the blog, we can see the reasons behind why more and more brands are integrating sustainability elements into their loyalty programs. Implementing sustainable initiatives into your loyalty program’s offerings can be done in multiple ways such as product innovation, responsible sourcing, eco-friendly packaging & more.

If you are planning to unlock the potential of integrating sustainability into your loyalty program or build a new loyalty program from scratch, you can take the help of Novus. We specialize in building a wide range of Sustainable Loyalty Programs & give you insights into effective strategies to make your business win customer loyalty effortlessly. Book a demo to upgrade your loyalty program to the next level with sustainability initiatives.

  • © 2024