5 Best Rewards Programs To Grow Your Small Business

Get Started With Square POS

Pricing

$0/month

Contract

None

Equipment Cost

$49-$799

Get a free card swiper from Square at no cost when you create a free account. Claim your card reader.

Pros

Free POS
Easy to use
Reports let you measure the ROI of your loyalty program
Integrates with entire Square suite of business products

Cons

Must use with Square credit card processing
Monthly cost can get expensive if you use multiple Square add-ons

square register with credit card

Why We Chose Square POS For Loyalty

Square is an excellent free POS with an in-house loyalty program. Square is set up so that the core POS functions are free, and you only pay for whichever advanced functions you need, including loyalty. Like the POS itself, Square Loyalty is intuitive and easy to use, with a clean, uncluttered interface.

Square's digital loyalty program has businesses enter a customer's phone number, and the customer receives automated texts about their reward activity every time they make a purchase, either in-store or online. There's nothing for customers to download and the texts they receive are arguably more attention-grabbing than an email (case in point: I currently have 35,000 unread emails and 0 unread texts). Businesses can then track their loyalty program's success using reports which show how much they've earned from loyalty sales versus non-loyalty sales; according to Square, customers who enroll in Square Loyalty spend 40% more.

Square Customer Loyalty Features

Square Loyalty offers the following rewards software features:

Works with multiple industries (restaurants, retail, personal services, etc,)
Works with other Square products (Square Restaurant, Square for Retail, Square Appointments, etc.)
Easy customer onboarding from POS screen
Customizable program lets you choose how points are earned, reward tiers, & reward terminology
Marketing features including text & email campaigns
Omnichannel program lets customers earn & redeem in-person and online
Multilocation program works for all your Square stores
Data tracking from your Square Dashboard

Square Membership Program Pricing

With Square’s loyalty program, only pay for how much loyalty functionality you use. Square POS is free, and loyalty pricing is based on how many loyalty visits you receive each month. Square Loyalty runs $45/month for 1-500 loyalty visits per month and goes up from there. You can try out the software for 30 days for free before deciding if you want to purchase it.

Hardware Cost

You can use Square POS with Square Loyalty on a variety of hardware setups, including iPad, Android, and Square’s proprietary hardware solutions, such as Square Register and Square Terminal.

Though you can technically use Square with just a free magstripe reader (or $49 chip and tap reader) and a mobile device, most businesses will want a countertop POS setup. Square hardware kits start at $619 for a Square Stand kit for iPad that includes a Square swivel stand with a built-in card reader, a cash drawer, and a receipt printer (iPad not included).

Square Register kits start at $1,199 for a Square Register—a tablet register with a customer-facing screen and built-in payment acceptance—cash register, and a receipt printer. A Square Register by itself is $799.

Payment Processing

With its in-house flat-rate payment processing—Square’s rate is 2.6% + $0.10 per in-person transaction—Square is best for newer and lower-volume businesses; established, high-volume businesses may find better payment processing rates by getting their own merchant account.

Contract Requirements/Warnings

Square POS is month-to-month with no contract, which means you can stop using the service at any time; the same goes for Square Loyalty. The one warning we have for Square is that it has less account stability than a traditional merchant account, as Square is a third-party payment processor. Learn more on the pros and cons of processing with Square by reading our guide to third-party payment processors.

2. Lightspeed Loyalty: Best For Retail With eCommerce

Lightspeed Retail POS

Get Started With Lightspeed Retail POS

Pricing

Starts at $89/month ($69/month billed annually)

Contract

None

Equipment Cost

Contact Lightspeed for a quote

Pros

Retail-specific POS
Excellent built-in loyalty program
Built-in eCommerce
Free payment terminal with Lightspeed Payments

Cons

Expensive for smaller retailers
Must use Lightspeed Payments

Why We Chose Lightspeed Loyalty Program

Lightspeed Retail is a retail POS for iPad and desktops that makes it fast and easy to sell in-store and online.

Lightspeed also has an excellent in-house eCommerce program, which integrates seamlessly with the Lightspeed POS and Lightspeed Loyalty, a points-based loyalty program with flexible reward tiers, built-in marketing, and CRM.

Lightspeed Loyalty Program Features

Lightspeed Loyalty offers the following customer loyalty program features:

Fully integrated with POS workflow, so you only need to visit the back office for initial setup & running reports
Omnichannel design lets customers redeem rewards online or in-store
Customer auto-segmentation based on purchasing habits
Branded loyalty app to send promotions & one-time deals
Automated marketing campaigns for text & email using a drag & drop tool
Import data & balances from another loyalty program
Retail-centric system includes multi-tender options, inventory matrix, PO management, & deep reporting

You can read our full write-up on Lightspeed Loyalty to learn more about program features and setup.

Lightspeed Loyalty Pricing

Lightspeed Loyalty is included on the $269/month Advanced Lightspeed Retail plan ($199/month with annual billing) and on the Enterprise plan for large businesses (call for quote).

You can purchase Loyalty on lower-level plans as a separate add-on.

Hardware Cost

You can use Lightspeed on an iPad or desktop setup. You can source your POS hardware yourself or purchase a kit directly from Lightspeed (call for quote).

Payment Processing

Lightspeed Retail integrates with Lightspeed Payments. You’ll pay a flat rate of 2.6% + $0.10 for in-person payments and 2.9% + $0.30 (the same rates offered by Square) and you’ll get a free Verifone P400 terminal (swipe, dip, or tap).

Contract Requirements/Warnings

To get the best pricing on Lightspeed Retail with Lightspeed Loyalty, you need to pay annually. This means Lightspeed is more of a commitment than a pay-as-you-go POS like Square.

3. Clover: Best Quick-Serve Restaurant Rewards Program

Clover POS

Get Started With Clover POS

Pricing

Starts at $0/month

Contract

Depends on merchant services provider

Equipment Cost

$49-$1,799 per device

Pros

All-in-one, plug-and-play hardware
Easy to use
Affordable software plans
Mobile-friendly

Cons

Hardware is expensive & can’t be reused
Not all Clover payment processors are high-quality

Why We Chose Clover POS For Loyalty

Clover is an all-in-one small business POS that runs exclusively on Clover's proprietary Android-based hardware kits, pre-installed with apps for various functions, including loyalty rewards. Though multiple business types use Clover, it's especially favored by quick-service restaurants such as coffee shops and has a dedicated QSRs service plan.

Clover's built-in loyalty app, Clover Rewards, is incredibly easy to use, both for businesses and their customers. Clover Rewards is incredibly mobile-friendly, and your customers may even have the Clover app already installed on their phones.

Clover Rewards App Features

Clover’s customer loyalty app has these useful reward program software features:

Rewards app comes pre-installed on your Clover system and is included in most plans
Effortless setup, right from your POS screen
Customize offers to fit your business and offer multiple perks to appeal to different customers
Customer-facing mobile Clover app lets users earn rewards when ordering from their phone or in-person
Multiple ways to earn & redeem rewards, including SMS codes printed on receipts, the Clover app, & self check-in on Clover’s customer-facing screen
Customers can track points using the Clover app
Rewards reporting shows which perks are most popular

Clover Loyalty Program Cost

Clover offers a variety of different plans ranging from $0/month for basic payment processing and up. Clover’s loyalty app is included on the Essentials plan ($14.95/month/device) and higher.

Hardware Cost

You can use Clover Rewards on a Clover Flex ($499), Clover Mini ($799), or Clover Station ($1,799) setup. Businesses that want a countertop POS will need at least one Mini or Station, sometimes with a Flex to take mobile orders. (Clover Rewards does not work on the $49 Clover Go reader.)

Payment Processing

Clover.com offers flat-rate rate processing at 2.3% + $0.10 and up. Your processing rate depends on your monthly software plan. If you buy your system from a different Clover provider, your merchant account may use a different processing model.

Contract Requirements/Warnings

Many different companies sell Clover POS systems with merchant accounts, and some of these Clover providers are not recommended due to their long-term contracts, expensive equipment leases, and other issues. Learn more about where to buy a Clover system by reading our post on the best Clover service providers.

4. Toast POS: Best Restaurant Rewards Program

Toast POS

Get Started With Toast POS

Pricing

$0-$165 plus custom plan

Online Ordering

Yes

Equipment Cost

$0-$847

Pros

Complete restaurant POS
Restaurant-grade hardware
Easy loyalty onboarding
Android-based

Cons

Must use with Toast Processing
Requires long-term contract

Why We Chose Toast POS For Restaurant Rewards

Toast is an Android-based POS system with pretty much any feature a restaurant could ever need, from ingredient management to delivery and takeout modules to table management for in-person dining.

Toast has incredibly strong employee management and POS reporting features, as well as smart CRM features that include a built-in points-based loyalty program. Overall, Toast is a smart choice of POS if you want a system specifically for restaurants with in-house loyalty.

Toast Restaurant Rewards Program Features

Toast POS has these and other useful loyalty rewards software features:

Links to customer’s credit card, so customers accrue points automatically
Customizable rewards program allows restaurants to customize sign-up bonuses, set accrual and redemption rates, and offer birthday rewards
Multiple signup methods—POS, self-order kiosk, customer-facing display, Toast Go, & online ordering
Integrated online ordering module lets customers earn and redeem points online
Loyalty program reporting gives you insight into who your regulars are and how much they spend.
Rewards lookup website lets customers look up their points balance online
Integrated gift card program allows Toast gift cards to be registered as loyalty cards

Toast Loyalty Pricing

The Toast POS itself starts at $0/month for a pay-as-you-go plan or $69/month for a standard plan. The main difference is that the free plan charges more for payment processing.

Toast Loyalty is an add-on to the POS that costs $50/month or an additional 0.40% per transaction, depending on your plan.

Hardware Cost

Toast POS hardware starts at $875 for a countertop kit. You can alternatively get a Toast hardware kit for free if you opt for the pay-as-you-go plan.

Payment Processing

Toast includes integrated payment processing and does not allow you to use an outside processor. Rates vary depending on your package. The lowest published price on Toast’s website is 2.49% + $0.15 for in-person transactions.

Contract Requirements/Warnings

Toast requires a long-term processing contract, during which the company increases its credit card processing fees with 30 days’ notice (per Toast’s merchant agreement). These contracts can be as long as three years and renew automatically after the initial term for another year. If you want to get out of your Toast contract at any time, you’ll have to pay an early termination fee (ETF).

5. Loyverse: Best Free Loyalty Program For Small Business

Loyverse

Get Started With Loyverse

Pricing

$0/month

Contract

None

Equipment Cost

Pros

Free POS
Free loyalty software
Suitable for any industry
Can use your own merchant account

Cons

Basic functionality
Limited software integrations

Best Touch Screen POS

Why We Choice Loyverse Free Loyalty Rewards Program

Loyverse is a free POS that includes an excellent built-in loyalty program---also free! Best of all, it can be used in any industry: restaurant, retail, service industry, you name it. The Loyverse POS itself is intuitive and easy to use, though somewhat basic, particularly in terms of its inventory features. Still, for newer merchants looking for a basic, free POS program with free loyalty, Loyverse might have all you need.

So what's the deal with Loyverse's free, built-in loyalty program? When customers download your loyalty app, they can start to earn points, which they can redeem for discounts on your products or services. You can also use the app to send messages out to your customers. On the back end, you can add information about your customers and view their rewards activity.

Loyverse POS Loyalty Program Features

Simple setup lets you start your loyalty program in a single click— just set the reward percentage from each purchase
Multi-industry POS with loyalty program has both retail & restaurant features
Multistore functionality lets customers receive rewards across all your stores
Physical card option allows you to issue a loyalty card with a barcode
Customer-facing loyalty app includes messaging feature for marketing
Customer profiles display customer’s purchasing and loyalty history

Loyverse Pricing

Loyverese POS is free, as is its loyalty module. Loyverse does offer some paid add-ons–employee management and advanced inventory— but they are optional and inexpensive, each offered at $25/month or $250/year.

Hardware Cost

You can use Loyverse on a smartphone, iPad, or Android tablet. You can purchase hardware on your own or buy various individual hardware components through Loyverse.

Payment Processing

Loyverse merchants in the US can process payments using Worldpay, Zettle by PayPal, or SumUp.

Contract Requirements/Warnings

Though Loyverse may seem too good to be true, it really is free, with no caveats like expensive hardware leases or long-term payment processing contracts. For payment processing with Loyverse, both Zettle and SumUp are no-commitment third-party payment processors, similar to Square. The only negative about Loyverse is that it is a somewhat basic program, and it only integrates with a couple of other software programs.

Vend

Vend is an awesome retail POS with loyalty, but it has been absorbed into Lightspeed Retail and is now fully branded as Lightspeed Retail POS (X-Series). If you are interested in Vend’s loyalty features, you should instead head over to Lightspeed’s website.

eHopper

eHopper is a budget POS system with both free and paid plans with loyalty. Though loyalty isn’t available on the free plan, eHopper is still a much more affordable system compared to something like Lightspeed. However, we only rate eHopper 3/5 stars, as better customer loyalty options are available at this price point. Read our eHopper POS review to find out why.

Shopify POS

Shopify POS is a highly rated omnichannel retail POS for small businesses. Unfortunately, Shopify does not include built-in loyalty rewards functionality. Shopify does integrate with various third-party customer loyalty program software, but this will add to the monthly POS cost, which is already not cheap. So, Shopify probably isn’t the best POS for loyalty.

What Types Of Rewards Should Your Small Business Loyalty Program Offer?

Generally, businesses should use an electronic customer loyalty program that includes customer data, automatic segmentation, and email marketing. Programs should also support mobile and multichannel—meaning customers can redeem points on their phone, on your website, or at your store. However, what type of customer rewards you should offer depends a lot on what type of business you have.

Coffee shops, for example, do well with points programs wherein customers receive points for each purchase, which they can redeem for a free item when they have enough. Many coffee shops also use punch cards (frequency program), though this type of low-tech rewards program doesn’t carry the same benefits as a digital program.

Stores with higher average tickets, such as many retail stores and restaurants, may primarily use discount programs, where customers can eventually earn a significant discount on a meal or item.

The best rewards programs can combine different types of rewards, including non-monetary rewards such as free birthday items, exclusive giveaways, etc.

Structuring the rewards to the needs of your business is important for creating an effective program. If you’re still not sure what kind of rewards to offer, it’s a good idea to research what kinds of rewards competitors in your industry are offering. Also, you can reach out to customers directly with a survey about what types of rewards they would be interested in receiving.

5 Effective Ways To Use Your Loyalty POS Program Data To Boost Sales

If you want to get a good return on your investment in a loyalty-enabled POS, you need to do a little legwork to configure your system so you can regularly communicate with customers using the program. Here are some specific tactics to boost the effectiveness of a loyalty program.

Incentivize Loyalty Signup: The most important first step in building customer loyalty is getting customers signed up for your program in the first place. By offering a reward or incentive for customers to sign up (for example, a free drink or 50% off coupon), you’ll be able to onboard a higher percentage of your customers.
Integrate Text & Email Marketing: Most loyalty programs have text and/or email marketing capabilities that let you send special offers, promotions, and of course, rewards. Make sure you take advantage of this integration so you can get the most out of your program.
Let Customers Redeem Rewards Online: If customers have more than one way to redeem rewards, they have more opportunities to spend money at your business. A POS with eCommerce lets customers redeem loyalty points online, thus encouraging purchases on your website (or app), as well as in your physical establishment.
Offer Gift Cards As A Reward: Like loyalty programs, gift cards also encourage customers to return to your business, and to spend more money when they do so. When a gift card program is combined with a loyalty program, the effectiveness of both programs is enhanced.
Incorporate Social Media: Social media marketing can boost awareness of your loyalty program and give customers more opportunities to interact with your loyalty program. Some POS systems even allow customers to purchase right from social media, without even requiring you to set up a dedicated website (e.g., Square, Shopify).

The Bottom Line On Starting A Rewards Programs For Small Business

If loyalty software is built into your POS system, use it! Even the simplest of rewards programs can help your small business increase sales and improve customer relations. If your system does not offer any kind of loyalty functionality, I would strongly recommend switching to one that does.

Rewards Program For Small Business FAQs

How do I start a rewards program for my small business?

Starting a rewards program for your small business can be as simple as signing up for a POS with a loyalty program. There’s nothing to download with cloud-based rewards software, and most of these digital programs don’t require the use of physical cards. You simply need to activate the software and configure the settings online.

What are some examples of customer loyalty programs for small business?

Some examples of loyalty programs for small business are:

Point-Based System: Customers earn points they can redeem for perks
Physical Punch Cards: Customers get a free item after a certain number of purchases
Membership Tiers: Customers achieve a higher status with more perks over time

What is the best POS system with a loyalty program?

The best POS loyalty program depends on your industry and your budget. Lightspeed Loyalty, Square Loyalty, Clover Rewards, Toast Loyalty, and Loyverse are all excellent POS rewards program software.

What are some ideas for a small business rewards program?

Some ideas to make your SMB rewards program successful include:

Offer free items for customers who sign up to the loyalty program.
Allow customers to earn loyalty points on online purchases.
Use your loyalty software reports to measure the success of your program.

In Summary: The 5 Best POS Loyalty Programs For Small Business

Square POS:
- Best for low-volume businesses
- $45+/month
- Flat-rate processing at 2.6% + $0.10
Lightspeed Retail POS:
- Best for retail with eCommerce
- $269+/month ($199+/month with annual billing)
- Flat-rate processing starts at 2.6% + $0.10
Clover POS:
- Best for quick-serve
- $14.95+/month
- Flat rate processing at 2.3% + $0.10 and up
Toast POS:
- Best for full-service restaurants
- $0+/month
- Flat-rate processing at 2.49% + $0.15 and up
Loyverse:
- Best free small business rewards program
- $0+/month
- Choice of payment processor

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Shannon Vissers

Senior Staff Writer at Merchant Maverick

Shannon has been writing for Merchant Maverick about small business software and financing since 2015. She started writing professionally about business topics in 2005. Shannon has been featured in the Washington Post, Reader's Digest, US News, MSN, Yahoo Finance, Business Insider, and other publications. She has a bachelor's degree in English from San Diego State University and currently resides in San Diego, California.

@ShannonVissers

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1. Square POS

❮ ❯

Best for low-volume businesses
$45+/month
Flat-rate processing at 2.6% + $0.10

2. Lightspeed Retail POS

❮ ❯

Best for retail with eCommerce
$269+/month ($199+/month with annual billing)
Flat-rate processing starts at 2.6% + $0.10

3. Clover POS

❮ ❯

Best for quick-serve
$14.95+/month
Flat rate processing at 2.3% + $0.10 and up

4. Toast POS

❮ ❯

Best for full-service restaurants
$0+/month
Flat-rate processing at 2.49% + $0.15 and up

5. Loyverse

❮ ❯

Best free small business rewards program
$0+/month
Choice of payment processor