In short: Loyalty points are a reward customers collect with every purchase and later redeem for a discount or a gift.
The full guide: How to increase shop sales
Work it out now: Discount
Loyalty points reward customers who come back. They earn points as a share of what they spend, then redeem them for a discount. For example: one point per dinar, and every 100 points is worth one dinar off. Under that rule you give back 1% of spending. Formula: points value = number of points × value per point. What it really costs you comes out of your margin, not the selling price.
In Jordanian neighbourhoods, customers usually choose between two or three shops on the same street. Points give them a reason to choose yours. In Ghalleh you switch on the points program from the shop menu and set how much a customer earns per dinar and what a point is worth; the cashier adds the customer by mobile number at payment, the points are recorded, and the customer spends them whenever they like.
What loyalty points cost from your profit
| Reward as a share of sales | With a 15% margin | With a 30% margin |
|---|---|---|
| 1% | 6.7% of your gross profit | 3.3% of your gross profit |
| 2% | 13.3% | 6.7% |
| 5% | 33.3% | 16.7% |
Share of profit = reward rate ÷ margin. That is why small rewards suit groceries with thin margins.
Rules for a points program that works
- Keep the rule simple enough to explain in one sentence.
- Link points to the customer's mobile number, so no plastic cards are needed.
- Give points an expiry so old liabilities do not pile up.
- Skip points on very thin-margin items if they would turn a sale into a loss.
A shop example
A supermarket in Irbid gives one point per dinar, and 100 points are worth JOD 1. A customer spends JOD 250 over two months, collecting 250 points worth JOD 2.500, which she redeems as a discount on her next invoice.
Common questions
Do loyalty points suit small shops?
Yes, if they stay simple. You do not need plastic cards, linking points to the customer's phone number is enough. What matters is that the cost is worked out from your margin.
What reward rate makes sense?
It depends on your margin. In groceries, where margins are thin, 1% to 2% is realistic. Shops with wider margins, such as perfume and clothing, can give more.