Loyalty Register glossary
Earn rate
How many points, or how much reward, a member earns for each unit of spend or each qualifying action.
Earn rate is how many points, or how much reward, a member receives for each unit of spend or each qualifying action. Sephora Beauty Insider members, for example, earn 1 point per dollar spent on Sephora merchandise, and Starbucks members earn Stars based on spend.
Updated · By Loyalty Register Editorial TeamRelated terms
What can an earn rate be based on?
Most programs use spend, but the unit can also be a visit, a transaction, a distance flown or a task such as writing a review. Whatever the unit, it should be stated plainly for every channel. If online and in-store purchases earn differently, members need both rules, not one headline rate that hides the difference.
Why does an earn rate mean little on its own?
Because a point is only worth what it buys. A hypothetical member who earns 3 points per dollar on $500 of monthly spend collects 1,500 points. If a point redeems at half a cent, that is $7.50 of value. Raise the earn rate to 5 points per dollar but lower the redemption value to 0.3 cents, and the same spend still returns $7.50. The headline changed; the value did not. Tesco states the conversion plainly instead: 150 Clubcard points turn into £1.50 of vouchers.
How should a program set its earn rate?
Set it together with the value of a point and the reward catalog, because together they decide the real return to the member and the cost to the business. Every point issued adds to the points liability, so the earn rate is also a budget decision. Decide how much value you want to return per dollar, then work out the earn rate and reward prices that deliver it.
What about bonus and promotional earning?
Bonus offers, such as double points on a product or during an event, raise the earn rate for a defined purchase or period. They can bring members back or push a new behavior, but they also add to the liability. Keep the base rule visible while a promotion runs, and measure whether the promotion changed behavior or only rewarded purchases that would have happened anyway.