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As an eCommerce brand, you can experience a lot of competition online. Websites are global, and therefore, whilst this may open you up to many customers, they also have a wide choice of businesses to choose new products from. This means they may not return for repeat purchases. To ensure you retain your existing customers, you may decide to introduce a customer loyalty program, like a points system, loyalty cards or rewards for introducing new members. Your terms and conditions must account for legal issues, such as handling personal data. This article will explain three essential terms and conditions for your customer loyalty program.
What is an Online Loyalty Program?
As an online business, introducing a loyalty program to your customers can be an effective way to retain customers or build new ones. Your company will provide rewards, such as discounts, as a loyalty thank-you gesture to customers who return to your brand. This helps customer retention and encourages consumers to refrain from shopping with your computer brands.
Before introducing a loyalty program, it is critical to draft robust terms and conditions. The following section explores key provisions to include.
Terms and Conditions
Some businesses may choose to include the terms and conditions of their loyalty program as part of their standard terms and conditions document. However, others may create a new set specifically for their reward program. It can be beneficial to do the latter for greater clarity. There are a variety of terms and conditions you may wish to include in your loyalty program. We explore these below.
Acceptance and Withdrawal
As with any terms and conditions, your customers must consent to the terms of your loyalty program. This may sound like an obvious point, but it is a significant one. While customers may choose to purchase from your business, they might not want to join your loyalty program. Your terms and conditions should clearly state how customers can join the program, such as by filling out a specific form to indicate their consent.
Additionally, some customers may later change their mind and wish to leave the program. Therefore, your terms and conditions clarify how customers can withdraw.
Eligibility and Membership
An important term for your online loyalty program is defining how an online customer can join the scheme. For instance, you might have age restrictions or state that only certain locations qualify. Likewise, will your membership be free, paid, or by invitation?
You might also consider clarifying how customers can prove their membership. For instance, will each person have a unique member number they type into your online store when making a purchase?
Data and Privacy Issues
When you have a loyalty program for your eCommerce brand, you will need to collect personal information from your customers. This can include their:
- contact details;
- purchase history; and
- bank details.
You must let your online customers know how you will process this data and if and when you will pass it to third parties. This is a legal requirement under data protection law, so it is essential to include it in your terms and conditions.
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Key Takeaways
A customer loyalty program can be an effective way to gain and retain customers. However, it is important to draft clear terms and conditions surrounding the program. Amongst other terms, ensure you outline the following:
- how customers can accept or withdraw from your program;
- eligibility and membership requirements; and
- how your business will handle personal data.
If you need help drafting terms and conditions for your loyalty program, our experienced eCommerce lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.
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