Despite several ways to calculate points, one of the simplest is:
Take the average monthly revenue per month and decide how much your loyalty marketing budget is.
=> example - I sell SGD 10,000$ /month => how much of that value do you wish to use for your reward program?
=> let’s take 5%
=> 5% of SGD. 10,000$. Total reward budget is SGD. 500$
What is the perceived value per point? Formula is 500/10,000 = 0.05 value per point.
=> It means that for every 100 points, you can give out a reward of SGD. 5$
If an item retail price is SGD. 40$ then the points collected are 40 points. Each will represent a value of SGD 0.05 x 40 - SGD. 2$ (or 5% of SGD. 40$).
SGD 1 spend = 1 point or SGD 1 reward = 20 points.
The Success Team will be more than happy to guide you through it and help you to think about the best strategy for your loyalty program.
Chat with us if you need help, we can support you on how to define your loyalty program!