10 common mistakes when implementing a loyalty program (and how to avoid them)

10 mistakes to avoid when implementing a loyalty program

Loyalty programs can be a powerful growth driver… or a major operational frustration. It all depends on how you implement them.

At Loyalty Marketing Services (LMS) , with over 27 years of experience designing and implementing loyalty programs throughout Latin America , we’ve identified the most common mistakes companies make. Some may seem small, but they have a significant impact on engagement, repeat purchases, and profitability.

Here we share the 10 mistakes to avoid when implementing a loyalty program — and, most importantly, how to avoid them with technology, strategy and tools such as CRM, OCR, Call Center, Artificial Intelligence and Machine Learning.

10 common mistakes when implementing a loyalty program (and how to avoid them)

1. Not having a clear strategy from the start

Error: Launching the program just “because the competition has one”, without defined objectives or indicators.
Solution: Define whether your goal is to increase repeat purchases, reactivate inactive customers, build distributor loyalty, or raise the average order value. At LMS, every program stems from a business-aligned strategy.

2. Ignoring customer segmentation

Error: Sending the same message and giving the same rewards to all profiles.
Solution: Use a robust CRM to segment by behavior, history, average order value, or location. This allows you to generate relevant campaigns and benefits for each customer.

3. Thinking that a loyalty program is just about accumulating points

Mistake: Offering points for every purchase without further differentiation or emotional connection.
Solution: Integrate levels, missions, storytelling, gamification, or experiences. At LMS, we design programs that go beyond transactional tasks.

4. Failure to train the internal team or sales force

Error: The customer asks about their program and the staff doesn’t know how it works.
Solution: Implement training, visual materials, tutorials, and even internal incentive programs. Loyalty starts from within.

5. Lack of specialized customer service

Error: Leaving unanswered questions about points, redemptions, registrations or expirations.
Solution: A call center with CRM access allows us to offer fast and personalized service. At LMS, we operate it with agents trained in loyalty programs and omnichannel support.

6. Not automating basic processes such as ticket validation

Error: Asking the customer to manually capture their ticket or wait days for validation.
Solution: Use OCR (Optical Character Recognition) to scan tickets from the app or website, and automatically credit points.

7. Not measuring or optimizing the program

Error: Not having clear metrics to know if the program works.
Solution: In our LMS, we integrate real-time dashboards with KPIs such as repeat purchases, points redeemed, active customers, average ticket price, NPS, and ROI . We also use machine learning to dynamically adjust the program based on user behavior.

8. Having unattractive or inaccessible rewards

Error: Offering generic, expensive, or hard-to-achieve prizes.
Solution: Design segmented catalogs with options relevant to your customer. Allow payment with points plus cash if needed. Less frustration, more redemptions.

9. Not communicating the program constantly

Error: Launching it and leaving it unattended.
Solution: Keep the program active with regular campaigns, newsletters, personalized messages via CRM, push notifications, and dynamic content on the app or website.

10. Do not adapt the program according to the channel

Error: Trying to use the same scheme for eCommerce, physical retail, wholesalers and distributors.
Solution: A good program is flexible. At LMS, we develop specific models for each type of client, channel, or industry.

Summary table: errors vs. solutions

Common mistake	LMS Solution
Without a defined strategy	Strategic planning and clear goals
Without segmentation	CRM with dynamic and automated profiles
Just points, no storytelling	Rewards ecosystem + gamification
Without team training	Training + materials + internal incentives
Poor customer service	Call center with CRM + AI specializing in loyalty
Manual ticketing processes	OCR for automatic upload and instant validation
Without measuring results	Dashboard with KPIs + machine learning
Unattractive rewards	Curated catalog + segment personalization
Sporadic communication	Multichannel marketing strategy
One model for all	Programs tailored to each channel and customer type

Because loyalty isn’t improvised: it’s designed, measured, and evolved.

At LMS, we have been helping leading brands in Latin America build loyalty among customers, distributors, and sales forces for over 27 years with intelligent programs. We design customized solutions that combine business strategy with technology and creativity.

Does your brand need a loyalty program that actually works?

Frequently Asked Questions

By Daniel Velasco Rallo
Strategy – Loyalty Marketing Services

10 common mistakes when implementing a loyalty program