Best Practices For Building A CPG Loyalty Program

Learn how to build an effective loyalty program for CPG brands that encourage repeat purchases, increase subscription rates, and more.

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From snacks to toiletries to household supplies, the CPG (consumer packaged goods) market is a highly competitive industry with major players both in ecommerce and physical stores. Notable trends in the CPG industry include the rise of subscription services, where customers get their favorite products delivered right to their door.

To stay competitive, CPG brands need to keep these opportunities in mind:

  • Customers’ main purchase consideration factors are product availability and attributes, not price
  • Low barriers to brand switching negatively impacts retention rates
  • Social sharing is heavily relied upon for product adoption
  • Subscription services help improve the precision of inventory and shipping cost estimates

Loyalty programs help CPG brands make the most of all of these opportunities - they encourage high purchase frequency and lifetime value, give brands a way to reward customers for subscriptions, and turn user-generated content and social media interactions into key drivers for purchase decisions.

Today’s top CPG brands also use loyalty programs to drive revenue, increase average order value, and boost basket size, resulting in the following:

  • $100,000 average dollar value earned from loyalty per year
  • 205% increase in average order value (AOV) from loyalty orders
  • 176% in basket size from loyalty orders

Disclaimer: To create this guide, we assessed the top CPG brands using Stamped Loyalty to identify common success factors by looking at their loyalty program set-up, execution strategy, and performance metrics. While these best practices are based on methodical quantitative and qualitative research, they are only recommendations, not requirements. They also do not guarantee the same results or level of impact demonstrated by these brands. We always recommend that brands assess their own needs, goals, and outcomes to determine what will work best for them.

To do so, brands should look to Stamped's analytics dashboard, which helps brands assess their loyalty program's performance by evaluating critical metrics like loyalty program revenue, changes in basket size and Average Order Value. Brands should regularly assess and optimize their loyalty setup by visiting the Program Health section.

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