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Overview of Third-Party Loyalty Platforms & Their Customizability

By Nick Epson on July 13, 2021

Trust is the foundation for most for just about any functional relationship – it’s an endearing trait in a good pet dog as well as the cornerstone of most romantic and business relationships which is why many integrate third-party loyalty programs into their digital presence to enhance customer relations. Unlike the dog who will still hold you in high regard if you occasionally feed him late or skip a daily walk, Hell hath no fury like a customer scorned.

Of course, simply making sure you’re not wronging customers isn’t the basis for a valuable business relationship today: your supporters want and deserve to be rewarded for their ongoing patronage. Fortunately, there are several options on the market today that developers can easily integrate into new and existing apps that significantly enhance customer retention. We’re going to explain the value of these systems then look at a few third-party loyalty programs options for building highly customizable experiences.

The case for third-party loyalty programs & the value they provide

Business relationships, whether you’re a B2B or B2C business, thrive when customers are supplied with a system that rewards them for continually spending money on your products or services. There are a lot of options on the market with similar solutions to you which is why retention and loyalty are such big factors in modern business. Long gone are the days of needing to butter up the local blacksmith to do a decent job repairing your farming equipment, just because he’s the only person for miles: your competitors are only ever a few taps or keystrokes away.

In the past, we addressed the matter of “why” these systems work so well where we used Starbucks and Dunkin’ Donuts as examples because of their highly effective solutions. Getting a perceived “deal” often translates to purchasing either a higher quantity, selecting a higher tier of service, or generally spending more money. So long as the sales or discounts you offer don’t adversely impact your bottom line (i.e., you’re not selling at a loss), you’ll naturally see a benefit from additional spending.

These systems used to be kind of a pain to integrate as developers often had to build a solution that would work with a store’s inventory and POS system from the ground up, plus each customer had to be manually issued an account. Perhaps you remember getting a store rewards card years ago that required filling out a paper form and waiting for a period to get your card before you could save? These days, onboarding and providing benefits to users need to be instant.

Third-party loyalty programs have the foundation for a customer loyalty system built in so it’s easy to use these systems out-of-the-box. The real value is the extensibility and analytics of the various systems on the market which we’ll touch on here shortly. 

The customization component means you’re able to fine-tune these solutions to do whatever you desire, whether that’s mimicking a competitor or building something truly innovative. You can configure these systems to use different manners of logic, depending on the nature of your business; for example, you can build something that offers rewards based on a total dollar amount spent, tether rewards to select items such as promotional products or services, offer discounts based quantity purchased or time passed since the most recent purchase, and much more. Plus, the customer data you generate will add yet another layer of value and most systems feature built-in tools for analyzing such information. Further, highly customizable also means flexibility and scalability as it allows you to build around user feedback as well as grow with your business into the future.

A look at several third-party loyalty program solutions

Sure, you can have something built from scratch that would provide you immense customization, but at great cost. The following systems (in no particular order) are a small fraction of the price, lightweight, and easy enough for both frontend and backend developers to work with.

LevelUp

LevelUp is one of the most recognized solutions for third-party loyalty programs as it comes from one of the biggest third-party food delivery services, GrubHub. As part of the GrubHub development shop, LevelUp allows developers to design solutions geared toward customer loyalty in the restaurant industry.

One thing that LevelUp leverages is its ability to accommodate a multitude of mobile payments, which is a topical discussion point you’ll find in most of their case studies. For those willing to partner with GrubHub for the long term, this tool can comprise the majority of an app that serves as a mobile ordering solution. Furthermore, you get the inherent benefit of added visibility for being part of the GrubHub network.

In fact, this system is used by the healthy, fast-casual chain, sweetgreen, which took home a prize at the 2020 Webby Awards in the same category as the product we developed for inHouse. It’s also what we used to augment the system for Kung Fu Tea – by using this platform, we were able to both improve their overall design for their Android and iOS apps as well as provide a system for marketing with robust data segmentation.

Punchh

While their name might look like the byproduct of a sticky keyboard key, Punchh positions themselves as an authority on customer loyalty and engagement. The Punchh platform offers a powerful set of base tools fine-tuned for restaurants, convenience stores, and retail which can be modified and added to accommodate any kind of business.

Off the shelf, the Punchh platform provides tools for creating and executing marketing campaigns, delivering offers, and analyzing every bit of information possible through an integrated, AI-powered engine. Punchh users can help businesses understand their customers by providing a granular view of spending and behavioral patterns that proves immensely useful for future campaigns and other significant decisions.

ChowNow

As another restaurant-focused solution similar to LevelUp, ChowNow has continually grown in popularity over the last decade as one of the earliest third-party loyalty program providers. In the same vein as LevelUp, it offers tools that enable developers to easily create menu and ordering systems with integrated loyalty rewards as well as an analytics system for understanding user behavior. Using ChowNow also allows businesses to be part of the ChowNow network which, like LevelUp, increases visibility even though it’s a little less popular than GrubHub.

Olo

The Olo platform is based on an idea that predates most of the competition as the company originated as a system in 2005 that allowed customers to text orders to coffee shops. Even though it didn’t catch on, it was able to pivot and accommodate the needs of the emerging mobile app market. Today, Olo not only offers tools for building menus, offering loyalty rewards, and analyzing data but the capability to do it on a large scale.

For those looking to go big, Olo is perhaps the best solution because of its enterprise offerings that appeal to franchises and entrepreneurs looking to bring a new solution to the market. With Olo, users aren’t tethered to either the GrubHub or ChowNow networks, which offers advantages for those looking to, for example, create an internal delivery system. It’s also modular enough to be used as the base system for a restaurant or retail app but mostly rely on other integrations for certain features. To further this example, let’s say a business wants to offer both ChowNow and Grubhub in a single app: because the Olo API is so robust, developers can use Olo as their underlying system and integrate either or both systems to provide a streamlined user experience.

We build custom experiences for restaurants and commerce

Blue Label Labs understands the importance of design and execution in delivering great mobile products. We understand how to leverage these systems and others to custom-tailor solutions unique to any business model. In other words, we can help design and develop features and functionality on top of or around one of these existing off-the-shelf solutions. You can see the results in digital products that we’ve helped develop for the likes of the aforementioned Kung Fu Tea, Cirque Coffee, Solo Fan, and more. To learn more about our process and discover how solutions featuring a third-party loyalty program can specifically benefit your business, get in touch today.