Increase customer retention and reduce churn rate. Loyalty programs that offer rewards and redemptions, for example, turn occasional customers into repeat customers.
With customer rewards, they become loyal to the brand, promoters and defenders of it organically. Culture is strengthened and a community is created naturally.
Loyalty programs encourage greater purchasing frequency from customers. The more they buy, the more rewards they will have and that is a great motivation.
With each customer purchase, the company can monitor their purchasing pattern, what products they purchase, how often. Everything helps to better guide marketing strategies.