Updated October 22nd, 2019

Do you have a customer loyalty / rewards program yet?

If not then follow along to set up an automated marketing channel that enhances your engagement and adds cool points to your brand.

I’ve been working in ecommerce since 2011 and have made a few relevant observations:

  • Owning an ecommerce store has exploded in popularity (increasing competition)
  • Advertising costs have increased significantly (increasing cost of acquisition)
  • Good branding is key to generating referral traffic and repeat business

This is why I lean so heavily on referral marketing for Shopify stores.

Having a rewards program integrates referral marketing + customer loyalty = double win.

It’s easier to sell to existing customers than new customers, but how can you increase your customer retention?

  • Create great product(s)
  • Awesome customer service
  • Have a rewards program!

I’m all about the automation and scalability, so today’s star is an app called Smile

Smile customer loyalty for shopify

Smile has a super easy to use rewards program that sets you up with:

  • Loyalty points and rewards
  • VIP tiers
  • Referral incentives
  • Increased brand engagement
  • Analytics to track your ROI

The beauty of this marketing model is that once you set up the system, it’s completely automated 😎

Why set up a customer loyalty program?

  • Advertising costs go up every year
  • Competition increases every year – ecommerce brands need to consistently work on being unique and standing out
  • Increase customer retention – when you build up points/credit, you feel a little more compelled to use them so they don’t “go to waste” am I right?
  • Get people engaging with your brand more – give reward points for liking/sharing on social media
  • Get more first time visitors into your ecosystem – give reward points or discount just for signing up
  • Be unique and give the impression of a thriving brand
  • It becomes an automated evergreen marketing channel

Get inspiration from other rewards programs

Think about rewards programs in other industries:

  • Airline points keep people flying the same airline even though it might not be the best value flight at that time
  • Cafes give a free drink every X purchased to encourage brand loyalty
  • Credit cards give cash back – you’re likely using that 1 card for all your business purchases to stack up cash back, miles, etc.

Note to dropshippers: this could be the advantage you’re looking for

I used to own a dropshipping business, it’s tough! You’re selling the same products as other stores so good branding is key to give you a competitive advantage.

That old store was in the office products niche so not the most exciting haha but even then I could have used this knowledge now to at least offer free shipping and discounts for repeat customers.

Give customers a reason to buy from you instead of the others offering the same product.

Increase Referral Traffic

Smile has a referral program built in – you can set it up so customers can share their link with a friend, giving them a discount on future purchase, and their friend a discount on their first purchase.

By being a cool brand offering loyalty rewards people will talk about you more.

awesome brand meme

Referral marketing is the most trusted source of advertising, and low cost, so it makes sense to add more referral channels.

I like to combo Smile with Refersion to get the simplicity of customer referrals (Smile) + a robust affiliate system (Refersion) for influencer / professional affiliate marketing.

They’re completely different apps, but both achieve the goal of increasing referral sales and traffic.

What’s the ROI?

I ask this question with every recurring app I use, usually in terms of:

  • “What’s this store’s average order value?”
  • “What’s the profit margin?”
  • “What’s the monthly cost of this app?”

With that data, the key question is “Do we think this app will generate X amount of sales per month to cover its break even cost?”

If yes, I give it a go for at least 4 weeks.

Smile has a limited free plan, but their full suite starts at $50/mo. For a store getting any traffic at all that’s a no brainer to me…. $50/mo for most stores usually means getting just a few new orders.

Smile app pricing:

app pricing for smile rewards points app

How to create your rewards program with Smile

When I started using Smile I installed the app, then booked a demo, then brainstormed ideas for points/rewards, then analyzed and adjusted, then let it riiiiiide and check in every couple months :)

It might seem like a large project from the onset but once you get the app set up it’s mind blowing how simple it is – props to Smile for creating a super intuitive UI for both merchant and customer.

1. Install the app

Head to Smile.io and click Get Started.

From there you’ll enter your store info and install the app.

They’re really hands on there, and I see why – creating a rewards program can be daunting from the outside, so they give you the tools and advice to make sure you’re successful with your program (because obviously if you make money they make money 🤑).

2. Book a demo

This is optional, but I found super helpful and filled with a lot of “ooooh that’s a good idea!” moments.

You can also start playing with the app to get a feel for the system.

3. Create earning rules

Here are some of the standard earning rules I use:

standard earning rules

You’ll probably want to test your points system, but Smile can also give you their best practice recommendations.

4. Create rewards

The goal is to create rewards that are not too hard or too easy to attain. You’ll likely have to experiment with this, but again just ask Smile after you sign up and they’ll give you some good numbers to start with.

spending rewards

5. Enable referral bonuses

This is easy, just decide what you want people to get then enable it, example:

Referral bonuses with Smile

6. (optional) Create a VIP program

If you want to get started quickly you just need points and rewards, but to go full force you can create VIP program to incentivize more loyal cusotmers.

The way it works is if a customer spends X amount or earns Y tokens (lifetime or in the past year), they enter into the next tier to get better rewards.

This one is brand dependent and gives you the most opportunity for creativity. Here are some ideas:

  • Points multiplier (get 2x more points per action)
  • Free shipping on all orders
  • Special gift
  • Exclusive access to new / limited edition products
  • Get invited to the annual company beach holiday free trip 😎🌴
  • Think of things your customers would be stoked about, and include those in the higher tiers

7. Design and Launch!

They have the widget already set up for responsive design, you just need to edit the colors and text with their UI designer.

Preview that on your store and if it looks good, set it live!

Now share with your email list, publish a blog post, announce on social media. Get people stoked about your new program. Maybe give past customers some extra points to stoke the fire.

8. (Bonus) Set up automated email sequences

Smile has a lot of possible email automations to help you get more engagement and sales on autopilot.

Here are a few ideas:

  • Give a friendly nudge to customers that have enough points to earn a reward but haven’t redeemed them yet
  • When a customer leaves a 5 star review (happy customer), have an email automatically sent that includes their referral link, and ask them to share with their friends and fam
  • When someone creates an account, send an email explaining your rewards program – how to earn and points and get rewards

You can integrate these with your existing email marketing app by connecting it from within Smile.

Tips for success

  • Get creative with the name of your rewards points. Tie it into your branding to make it fun. Like if you’re in the pet industry, maybe your points are “treats”, or “doggo treats” 😃
  • Offer free shipping as a loyalty tier. People LOVE free shipping.
  • Smile integrates with a bunch of email and review apps, and you can even integrate with your retargeting if you’re using Shoelace
  • Brainstorm with your team to come up with creative rewards and VIP bonuses
  • Launch, share with your audience, get feedback, and experiment. Once you get it dialed in, it runs on autopilot

Find out what your customers want and give it to them in the reward tiers – an easy start is free shipping, everyone loves free shipping!


Ask Smile to share some examples of successful rewards programs with their app. I did that and got a nice feel for what their app does and what works.

Look at rewards programs of successful companies outside of your niche, like Starbucks rewards program.

Check out some case studies and best practices: learn.smile.io

Next: More Ideas for engagement and conversions

Check out our Shopify Conversion Rate Optimization Guide to get more ideas to increase sales + proven methods to improve your conversion rates.