Is your company planning to become one of the world’s many businesses with customer loyalty programs? If so it helps to know about the basic history of such programs. In fact, you might be surprised about how many decades the loyalty programs/cards have existed in the US and worldwide.

One of the most interesting facts about customer loyalty programs are they’ve existed for over a century. That’s right! One of the first ones was the S&H Green Stamp program that was launched back in 1896. Here’s how it worked. Customers received small stamps when they bought items from merchants that participated in the program. The glued the tiny stamps into booklets then turned them in for products when they collected enough stamps.

The program became quite popular. At the peak of the program the company issued 3x more stamps than the US government. It’s safe to say that the program helped S&H to become the world’s biggest buyer of consumer products by the 1960s.

General Mills had another popular loyalty program called the Betty Crocker Points Program. This gave customers the ability to collect points that could be turned in for kitchenware. The company reportedly started with teaspoons added to Wheaties boxes in 1931. Then the company started adding paper coupons in the packages of various General Mills brands. Later the points of its customer loyalty programs were printed on the outside of cardboard boxes.

A big event in terms of loyalty programs was the one of the US airline American Airlines. It was the world’s first frequent flyer program that was based on total miles flown. The program has become very popular and today is one of the world’s most popular Pathwwway loyalty programs among airlines.

The first loyalty program with a card was launched in 1982. It was created by Homebase, which is a British home improvement company. The program was very popular yet it’s interesting such plastic cards didn’t become popular among loyalty programs until the mid 1990s. After the British company Tesco launched its card-based loyalty program many supermarket chains then rolled out their own programs and cards.

Another big development was the use of loyalty programs by ecommerce. This has resulted in several programs in the digital space that include similar programs but different media. The goal is still the same though. As always the loyalty programs are launched to boost customer retention. When companies get freebies and discounts they’re more likely to stay loyalty to a particular company.

Today the number of customer loyalty programs keeps increasing exponentially. The channels used include email, social, and mobile. Customers can still earn points or move up to a higher tier by making multiple purchases from the same company. In fact, the main concept of loyalty programs hasn’t changed. So if you want to boost customer loyalty and reduce “churn” when companies forget a company you should definitely consider using a loyalty program.  If you design the right program with the right rewards you can definitely help to boost your retention rate.

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