Common Mistakes When Launching a Loyalty Program in 2025 — Analytics & Insights

The year 2025 has shown that loyalty programs have become an essential tool for HoReCa, retail, services, fitness, and e-commerce. However, many businesses continue to repeat the same mistakes — and because of them, loyalty doesn’t work, customers don’t return, and the owner concludes that “the program didn’t bring results.”

This article is a summary of observations from 2024–2025: real cases, experience working with chains and hundreds of businesses. And here is what most often breaks any loyalty program.

Mistake №1 — A Loyalty Mechanic That Is Too Complicated

If a customer has to figure things out, read conditions, or remember rules, they simply won’t use the program. A loyalty program must be so simple that a person understands how it works within a few seconds. Here are real examples of overly complicated mechanics we’ve seen in businesses:

Example 1 — Bonuses “on half the menu” Coffee — bonuses apply, desserts — no, breakfast items — only after 12:00.

The customer doesn’t understand the rules → loses interest.

Example 2 — Coupons with a long list of conditions Only on weekdays, only before 4 PM, only through the website, only if the receipt includes both a coffee and a dessert.

A customer tries once, it doesn’t work — that’s it, they will never try again.

Example 3 — Bonuses that expire too quickly 14 days, 30 days, 45 days — the customer physically does not have enough time to use them.

It creates the feeling that they are being “tricked.”

Example 4 — Different bonus percentages across locations of the same chain One location gives 5%, another gives 3%, and in the third bonuses don’t work at all.

Customer: “Why does your second location follow different rules?”

This kind of chaos destroys trust immediately.

Example 5 — A huge registration form First name, last name, date of birth, phone number, email, city, street, gender, age, favorite drink, comment…

The customer simply closes the form.

Registration must be short → otherwise no one will complete it.

Example 6 — Confusing “internal currency” “You have 2,350 coins, but you can only use 112. The rest is unavailable for now.”

Customer: “What? Why?”

Any unclear “game-like currency” immediately creates distrust.

The main rule

Your staff should be able to wake up in the middle of the night and explain how the program works in four words.

If they can’t — the mechanics are broken.

Why complicated mechanics always fail

1. The customer doesn’t understand the benefit. If the benefit is unclear — it doesn’t exist.

2. Cashiers get confused. Mistakes lead to conflicts, negative reviews, and loss of trust.

3. No one follows the rules. People will not read 10 conditions just to earn bonuses.

4. Complicated mechanics never scale. They may work at 2–3 locations but collapse in a chain of 10+.

5. Customers stop believing it's fair. When things are “too complicated,” people assume they are being tricked.

What mechanics work best

The best loyalty programs are:

• bonuses (for example, 7% on all purchases)
• tiers (Silver / Gold / Platinum)
• reward purchases (8th coffee free)
• simple coupons The customer quickly understands the logic → uses the card → returns again.

Mistake №2 — Using discounts instead of bonuses

This is one of the most common — and most expensive — mistakes businesses make. Discounts seem simple, but in reality they instantly cut your profit, without creating any loyalty at all. Bonuses work in the opposite way. They encourage the customer to return, increase LTV, and act as an investment in a future purchase, not as an immediate loss from the cash register.

Why 10% discount ≠ 10% bonuses

Many business owners think: “If I give 10% in bonuses — it's the same as giving a 10% discount.”

No. These are two completely different economic models.

1. A discount is a loss — immediately and forever

A 10% discount means you instantly give away part of your margin. You will never get that money back.

If your product margin is 20%, then a 10% discount is half of your entire profit.

2. Bonuses are not “money spent”

When you award the customer 10% in bonuses:

• the customer still needs to come back again
• the customer needs to place another order
• and only then they can use the bonuses

Often, a portion of the bonuses is never used at all.

But even when bonuses are redeemed, they cover only the cost price, not the full amount.

A simple example to make it crystal clear

Let’s say a customer makes a purchase for 300 UAH.

If you give a 10% discount

The customer pays 270 UAH. You instantly lose 30 UAH. This is a pure, irreversible loss.

If you give 10% in bonuses

The customer pays the full 300 UAH. You credit them with 30 bonus points. What happens next:

• to spend those bonuses, the customer must return
• on the next visit they still pay real money
• bonuses reduce only your profit, not the entire bill
• bonuses are redeemed at cost (e.g., 30 bonuses = 12 UAH cost price)

Bottom line: bonuses cost you 3–5× less than a discount.

In short: discounts = lost profit. Bonuses = fuel for repeat purchases.

A discount is “immediate, substantial, and forever.” A bonus is “later, partial, and only if the customer comes back.” That’s why 10% discount is never equal to 10% bonuses — economically these are completely different mechanisms.

Mistake №3 — Bonus percentage is too low for a low average check

This is one of the most underestimated mistakes businesses make. Many owners set 1–2% bonuses thinking: “Well, at least it’s something.” But in reality, this gives the customer nothing. If the average check is 600–800 UAH, then 1% is just 6–8 UAH in bonuses. The customer does not feel such a bonus — it doesn’t look valuable, it doesn’t motivate, and it doesn’t create any reason to keep the card. Here’s the simplest rule we use in consultations:

Ask yourself: would you sign up for a card with such conditions?

If the answer is “no,” the customer won’t sign up either.

A customer joins the program only when it is truly beneficial and easy to understand. They need something tangible:

• 5–7% bonuses
• levels where the reward increases
• a gift after N purchases
• a coupon for the first purchase

A meaningful benefit creates motivation.

Why small bonus percentages don’t work in real life

1. It takes too long to accumulate → uninteresting If a customer needs 10 visits just to earn 50 UAH, they won’t bother.

2. The customer doesn’t feel the “return” Bonuses only work when a person actually sees that they “give something back.”

3. Creates a feeling of “a promo for the sake of a promo” The program exists, but the benefit doesn’t.

4. No emotional response Loyalty is emotional: “It’s profitable here, they value me.”

The solution is simple: bonuses must match the average check

If the check is low → the percentage should be higher. If the check is high → the percentage can be lower. This is fair, clear, and effective.

1. Takes too long to accumulate → not interesting If a customer needs 10 visits just to earn 50 UAH, they will not wait.

2. The customer doesn’t feel any “return” Bonuses only make sense when the customer clearly sees that they work.

3. It feels like a “promo for the sake of a promo” The program exists, but there is no real benefit.

4. No emotional response Loyalty is emotion: “It’s profitable here, they value me.”

The solution is simple: bonuses must correspond to the average check

If the check is low → the percentage should be higher. If the check is high → the percentage can be lower. It’s fair, understandable, and effective.

Mistake №4 — Staff does not mention the loyalty program

This is the most common reason any loyalty program fails. A program may be perfect, beautifully designed, well-thought-out… but if employees never mention it, it simply doesn’t exist.

• It doesn’t exist for customers.
• It doesn’t exist for the business.
• It doesn’t exist in the numbers.

The reality is simple: staff = the engine of loyalty

If an employee says just one sentence — “We have a loyalty card, would you like to join?” — conversion increases 5–10×. If staff stays silent — only 1 out of 20 customers signs up.

Real case from 2025

The client worked in a difficult niche. But the staff:

• mentioned the loyalty program to every customer
• explained the benefits in two simple phrases
• consistently met their registration KPIs And the result:

87% of all receipts — with a loyalty card

This is one of the best results of the year. And it was achieved not thanks to “pretty card design” or “gifts”, but through staff discipline.

Where staff stays silent → 5–15% of receipts with a card

Where staff talks → 70–90% of receipts with a card

A 10× difference — and it depends not on the system, but on the people at the location.

The perfect phrase that explains everything

Your employees should be able to wake up in the middle of the night and say, in four words: “Earn 5% — use everywhere.” If staff can’t explain the benefit instantly — the customer won’t understand it either.

Mistake №5 — No unified system for the entire network

When a business has multiple locations but each one operates “independently,” chaos appears — and it completely breaks any loyalty program.

Typical problems we observed in 2025:

1. A customer buys in another location — and their bonuses “don’t show up” there. They receive a message: “You don’t have a loyalty card,” even though they purchased in the first branch yesterday. Result — distrust and frustration.

2. Each location has its own percentages, promotions, and levels. One place gives 5% bonuses, another gives 7%, somewhere the “8th coffee free” works, somewhere it doesn’t. The customer doesn’t understand what applies to them — and stops using the program entirely.

3. Order history “resets.” They move to another district → suddenly become a “new customer.” For the business, this means losing analytics, segmentation, and the ability to calculate LTV.

4. Staff get confused, customers complain, and the network loses trust. A fragmented system always creates the feeling that “something is wrong.”

A modern network must operate like this: one unified database → unified rules → synchronization across all locations → the customer feels “recognized” everywhere.

Loyallyst provides exactly this: a single unified system where every purchase updates bonuses, levels, and customer history across all locations. This is critically important when a network expands beyond one district or city.

Mistake №6 — Registering customers manually

Manual registration is the weakest mechanism and almost always ruins the launch of a loyalty program. Here’s what happens in real life:

1. The cashier forgets to offer it. Lines, stress, workload — as a result, registration happens only “when they remember.”

2. The customer doesn’t want to say their phone number out loud. Especially in cafés, salons, and retail stores — it’s uncomfortable and feels like a loss of privacy. 10 out of 10 customers choose QR instead of dictating their number.

3. Input errors. Wrong number → wrong customer → bonuses go “to nowhere” → conflict.

4. Very low conversion — 5–10% at best. Out of 100 customers, only 5–10 join your database.

When QR registration is used:

• the customer enters their details themselves in 10 seconds
• no phone number mistakes
• the cashier doesn’t need to fill anything in
• registration looks modern and pleasant

QR registration increases conversion by 4–7×, and in some industries reaches 60–80%.

And most importantly — the QR code automatically takes the customer straight to the Wallet card, where their bonuses and levels are already displayed.

Mistake №7 — No Marketing Around the Loyalty Program

One of the most common reasons why a loyalty program “doesn’t work” is that the customer simply doesn’t know it exists. A business launches bonuses, tiers, Wallet cards, automation… But if it’s not shown, mentioned, or communicated anywhere — for the customer, the program does not exist.

What happens in practice:

1. No signage at the location No stands, no table tents, no stickers, no QR codes. The customer doesn’t even visually understand that something valuable exists.

2. Staff doesn’t mention the loyalty program Or mentions it rarely and only upon request. If employees stay silent — the program freezes at the start.

3. No social media posts about the loyalty program Even though the audience there is the “warmest” and most ready to join.

4. No information on the website No loyalty page, no banner, no “Get your card” button.

5. QR codes are not placed in convenient touchpoints No QR on packaging, no QR at the checkout, no QR on tables. Yet QR is exactly what gives a 4–7× increase in registration conversion.

The result is always the same:

Customer doesn’t know → customer doesn’t join → the program “doesn’t work.”

But the problem is not the program — it’s the lack of communication.

How it should work ideally

A loyalty program is a product, just like the menu or the service. And it requires marketing:

• QR codes at every customer touchpoint (checkout, tables, storefront, packaging)
• Mini-stands explaining “Earn bonuses — spend them later”
• 1–2 social media posts per month
• A banner on the website
• Mention in the receipt or SMS/Telegram
• Staff mentioning it to every customer

When the program is supported by marketing, 70–90% of guests connect.

When there is no marketing, only 5–10% do.

The difference is tenfold, and it can be fixed in one day with simple materials.

Mistake №8 — “Fake Currency”: Huge Bonus Numbers With Tiny Real Value

This is one of the most toxic mistakes that destroys trust in the loyalty program. Many businesses want to “make it look impressive” and give customers:

• 50,000 bonus points
• 120,000 points
• 300,000 coins

But in reality this may be only 50 UAH, 120 UAH, or even 30 UAH of actual value.

The moment the customer realizes the true value, they have the first reaction:

“I’ve been deceived.”

This kills loyalty instantly, even if the system itself is good.

Why “fake currency” is a bad idea

1. The customer doesn’t understand the value They see 30,000 bonus points and expect real benefits. What they actually get is the ability to pay 30 UAH. The gap between expectations and reality is huge.

2. It creates false expectations When numbers are large, the customer automatically assumes it’s “a lot.” And the disappointment is much stronger when they find out the truth.

3. The brand loses trust Even if everything is clearly stated in the rules, the customer doesn’t care. They perceive the program emotionally: “Big numbers — little value → they tried to trick me.”

4. Staff don’t understand the conversion rate either If 1 bonus = 0.001 UAH, the staff will get confused. Staff confusion = conflicts + unhappy customers.

5. It complicates marketing Advertising “Get 20,000 bonus points for registration” looks good only on paper. In reality customers start asking: “So how much is that actually worth?”

A simple and honest solution

The best option is to use a clear, transparent conversion rate:

1 bonus = 1 UAH

Why a transparent system is better for the business

• fewer complaints
• less misunderstanding
• no need to explain the conversion rate 5 times
• easier for staff to sell the program
• easier for customers to use
• higher trust
• higher repeat purchase rate

Loyalty is about honesty and simplicity.

Fake currency is about confusion and disappointment.

Mistake №9 — Small chains try to build their own mobile app

This is one of the most expensive and useless mistakes small businesses continue to make.

If you have 1–5 locations, the chances that a customer will download your app are close to zero.

Why apps don’t work today?

The market in 2025 has changed completely. Customers:

• do not want to download an app just for a discount
• do not want to complete registration and verification
• do not want to waste phone storage
• do not want to open an app during every visit

Users are now accustomed to instant, “lightweight” solutions: Apple Wallet, Google Wallet, QR, Tap-to-Add — everything that works without installing anything and takes 2–3 seconds.

What happens when a small chain creates its own app?

1. Only the most loyal customers download it (5–10%) Everyone else ignores it: “Yeah, maybe I’ll install it later.”

2. Ratings drop quickly Any tiny bug → angry reviews → 2.3 stars in the store → nobody wants to install it.

3. The app never pays for itself Maintenance, support, updates — all of this is expensive. Downloads are low → no payback.

4. Staff must constantly beg customers to “install the app” And customers respond: “I don’t need another app.” This creates tension at the counter and irritation.

5. LTV doesn’t grow because there is no mass usage An app works only when it has thousands of active users. A small chain will not have them.

Wallet cards solve everything — without an app

Apple Wallet and Google Wallet are the modern standard:

• you don’t need to download anything
• the card is added in 10 seconds via QR
• push notifications appear directly on the lock screen
• the balance updates automatically
• the card works everywhere and always

And most importantly: everyone uses this.

Wallet is a built-in phone feature — not an app you have to “convince” people to install.

When does an app actually make sense?

Only if your chain has:

• 15+ locations
• daily repeat visits
• a large product assortment
• a developed internal marketplace
• a high budget and a clear product strategy

For all other cases, a Wallet card is 10× faster, cheaper, and more effective.

Conclusion: What 2025 revealed about loyalty programs

2025 has clearly shown that loyalty is no longer “a nice-to-have” — it has become an essential growth tool for every modern business — from a single-location coffee shop to chains with dozens of outlets.

But at the same time, this year also revealed another pattern:

it’s not the loyalty program itself that brings results, but how it is configured. We see hundreds of projects in HoReCa, retail, services, and e-commerce — and almost every successful case follows one simple rule:

A loyalty program only works when it is simple, honest, unified across all locations, and supported by communication.

Most failures happen not because of the platform, but because of common mistakes:

• overly complicated mechanics
• discounts instead of bonuses
• percentages that are too low
• staff not mentioning the loyalty card
• no unified database across locations
• manual registration
• no marketing around the program
• “cosmic” bonus amounts with no real value
• attempting to build a standalone mobile app for a small chain

All of these mistakes are easy to fix — and once they are addressed, the program immediately starts delivering real results:

• more repeat purchases
• higher average check
• stronger customer engagement
• a stable return rate
• increased LTV
• reduced dependency on advertising
• transparent analytics and predictable business performance

The conclusion is very simple:

There are no “bad customers” or “non-working programs.” There are only unclear, inconsistent, and unsystematic programs. When the mechanics are simple, the bonuses are fair, the staff understands the value, and the customer sees the card in their Wallet — loyalty begins to work on its own, every day, effortlessly.

2025 proved: a strong loyalty program is one of the cheapest, fastest, and most effective ways to increase business profitability.