How to Build a Loyalty Program App? Cost, Features & Tech Stack

Every sale feels like a win-win situation. Right?

But the challenge here is making customers loyal enough to come back.

Discounts and generic offers no longer work because today’s customers expect personalized rewards and seamless experiences. That’s exactly where loyalty app development comes in.

A customer loyalty app is more than just a digital punch card. It’s a powerful way to turn first-time buyers into repeat customers by giving them value that feels personal.

In fact, a study at Harvard Business Review found that a 5% increase in customer retention can lead to a 95% boost in profits. That’s the kind of impact you can’t afford to ignore.

And here’s the reality: if your business doesn’t build a solid loyalty strategy, someone else will capture your customers. That’s why more companies are investing in and creating a loyalty app or even opting for a white-label loyalty program app to move faster.

The message is clear: a powerful loyalty strategy is essential for survival.

That’s why this article is worth your time. Here you’ll learn how to build a loyalty program app, the development process of a loyalty program app, and much more. Read till the end & you’ll know exactly how to turn one-time buyers into long-term brand advocates & boost sales.

What is a Loyalty Program App?

A loyalty program app is a digital tool designed to retain your customers. Businesses no longer use paper punch cards; instead, they rely on apps to deliver rewards programs and offers in real-time.

When you create a customer loyalty app, you encourage your customers to stick with your business rather than move to a rival. It turns everyday purchases into exciting experiences, through points, cashback, exclusive perks, or even gamified challenges. Because of this, creating loyalty apps has become essential to growth strategies in a variety of sectors.

However, the important part is that there is no one-size-fits-all approach to loyalty apps.

Loyalty apps can be considered a bridge. On one side is the customer who wants value, recognition, and convenience. On the other side is your brand, seeking to optimize lifetime value and amplify retention. The app connects both sides in a way that feels effortless.

And because of this connection, businesses are exploring custom loyalty app development to maximize user retention and boost profits. Since customers expect personalization at every touchpoint, building a loyalty program app is now of utmost importance.

Loyalty Program App Example

Let’s look at some real-world examples that have set the benchmark:

1. McDonald’s Rewards

The McDonald’s Rewards app is a worldwide hit by turning everyday purchases into free meals and exclusive perks. Customers earn points with every order, which they can redeem for food items of their choice.

2. Amazon Prime

Amazon Prime is a full-fledged loyalty ecosystem. With perks like free one-day delivery, Prime Video, exclusive deals, and music streaming, Amazon creates a sticky experience that keeps customers coming back. By offering both tangible and experiential rewards, Prime proves how loyalty programs can magnify customer lifetime value.

3. Walmart+

Walmart+ is Walmart’s answer to retaining consumers in the midst of competitive retailing. With benefits like free shipping, fuel discounts, and a “scan & go” feature in-store, the app focuses on both convenience and savings. It highlights how loyalty programs can bridge digital and in-store experiences.

4. Dunkin’ Rewards

The Dunkin’ Rewards app keeps things simple yet effective. Customers earn points on every order, which can be redeemed for free food and beverages. What makes it engaging is the flexibility members can choose when and how to use their rewards. Seasonal promos, bonus points, and app-exclusive deals make Dunkin’s loyalty program a favorite among coffee aficionados.

5. H&M Membership

H&M’s loyalty app is an excellent case in the fashion retail segment. Members earn points for purchases, which can be redeemed for discounts or early access to collections. This brand also rewards eco-friendly actions like recycling clothes in-store. This amplifies engagement and also strengthens H&M’s sustainability positioning.

And now that you’ve seen how big brands are doing it, let’s break down the different types of loyalty program apps.

Types of Loyalty Program Apps

Not all loyalty programs operate in the same way. Different businesses require different models to engage clients. That’s why loyalty program app development often starts with choosing the right type of program.

Let’s look at the most essential ones:

1. Points-Based Loyalty Program

This is the most widely used model in loyalty app development. Every transaction a customer has with your brand earns them points. They can exchange their points for special offers, freebies, or discounts once they’ve accrued enough. Customers can easily understand this and create a direct link between spending and rewards.

Example: The Starbucks Rewards app demonstrates the potential strength of this model. Customers earn ‘Stars’ for each purchase. Those stars can then be swapped for free drinks, food items, or upgrades. One of the main reasons this mobile loyalty program software has millions of active users globally is its ease of use.

2. Tiered Loyalty Program

Within this model, customers progress through different levels or tiers as they engage more with your brand. Each tier unlocks greater rewards and benefits, which motivates users to spend more and stay loyal over time. It evokes a sense of exclusivity and accomplishment.

Example: Sephora’s Beauty Insider program is a classic case. Customers begin at the entry level but can ascend to higher tiers like VIB and Rouge. Each level offers perks such as early product access, free samples, and exclusive events. This customer loyalty app has built a strong community of beauty lovers around the brand.

3. Paid Membership Loyalty Program

In this model, customers pay a preliminary fee to get premiums, unlike free loyalty programs. The fee often magnifies loyalty to the brand, while the perks offered create a sense of added advantage.

Example: Amazon Prime is the most prominent example. Users pay an annual or monthly subscription and enjoy benefits like free one-day shipping, streaming, and exclusive deals. This custom loyalty app development approach has created one of the most loyal customer bases in the world.

4. Cashback Loyalty Program

Through this model, customers do not receive points, but a percentage of their purchase back in the form of cash or credit. This provides them with direct monetary motivation to continue shopping on the same platform.

Example: Rakuten runs on this model. Every time customers shop through the app, they receive cashback that can be withdrawn or used again. This loyalty program app shows how direct value motivates customers to return regularly.

5. Coalition Loyalty Program

A coalition program is where many businesses are united in a single loyalty program. Customers can redeem and earn rewards across various brands, offering them greater flexibility.

Example: One of the most well-known models of coalition is the Air Miles program. The customers accumulate miles by doing business with partner airlines, retailers, and gas stations. They can then redeem such miles into flights, merchandise, or services.
This kind of mobile loyalty program app works exceptionally well when brands form ecosystems around customer needs.

6. Gamified Loyalty Program

Gamification makes loyalty more interactive and fun. Customers complete challenges, unlock achievements, or play games to receive rewards. This model taps into human psychology, making the process of earning rewards thrilling.

Example: Nike Run Club is a great example of gamification in action. The app rewards users with milestones, badges, and recognition based on their fitness performance. Combining athletic objectives with loyalty, Nike keeps its users constantly active. This shows the power of gamification in loyalty apps for creating long-term connections.

7. Hybrid Loyalty Program

Most of the successful brands do not follow only one model. A hybrid approach combines elements like points, tiers, cashback, and gamification to create a richer experience. This flexibility allows businesses to adapt the program to various customer segments.

Example: Walgreens is also a good illustration of this model. Customers earn points for purchases (points-based), get personalized offers (data-driven personalization), and access tiered perks like health-related rewards. By combining elements, Walgreens ensures its customer loyalty app appeals to a wide range of shoppers while strengthening retention.

Next, we can explore why investing in loyalty app development is worthwhile and the benefits it can bring to your business.

3 Reasons to Invest in Loyalty Program App Development

Building a loyalty program app isn’t just about giving away rewards. It’s about building relationships that last.

Here are three compelling reasons why businesses worldwide are investing heavily in loyalty app development:

1. Customer Retention is Cheaper Than Acquisition

It is five to seven times more expensive to attract new customers than to retain the current ones. Retention is not only cost-effective, but also profitable. Bain and Company says that an increment of 5% in retention would increase profits by up to 95%.

A customer loyalty app ensures buyers don’t just shop once but return again and again.

2. Personalization Drives Higher Spending

Modern consumers expect brands to know and appreciate their needs. A mobile loyalty program app permits you to send targeted offers, tailored rewards, and personalized experiences. This matters because 71% of customers feel frustrated when experiences are impersonal. With custom loyalty app development, personalization becomes your competitive edge.

3. Loyalty Apps Build Stronger Brand Communities

A smart loyalty program app does more than boost sales. It builds emotional connections.

Features like gamification, tiered memberships, and exclusive rewards make customers feel valued and part of something bigger. This sense of belonging is the reason why major brands spend a huge sum of money on the development of loyalty apps. Through this process, they’re creating communities while also selling products.

Now you know why it’s worth investing in a loyalty app. To turn this strategy into reality, let’s get into the step-by-step development of a loyalty program app.

Step-by-Step Process to Build a Loyalty Program App

Creating a customer loyalty app is a purposeful action to elevate retention and revenue. Loyalty app development requires a clear roadmap.

Below are the steps you can follow to build a loyalty program app that captivates users globally.

1. Identify Your End Goals

All winning projects of developing loyalty apps begin with well-defined objectives. Would you like to boost purchase frequency, customer retention, or average order value?

By establishing attainable goals, you are able to set the benchmark for the success of your loyalty strategy.

For instance, you might set a goal to increase repeat purchases by 20% within the first year. Clarity will mean that the app is developed with business growth in mind, rather than focusing on customer perks.

2. Define Your Target Audience

When a customer loyalty app resonates with its users, it will succeed. This is why it is important to know your target audience.

Ask questions like: What motivates them: discounts, exclusive access, or gamified rewards? What devices do they use? How often do they shop?

By profiling your ideal customers, you can customize rewards and create an app experience that will make them feel special and worthwhile.

3. Choose the Right Type of Program

Your loyalty program app’s business model shapes the entire experience. Do you want a points-based system, a tiered program, or something gamified? Each type has strengths, as we explored earlier.

For example, a retail store might benefit from a points system, while a premium brand could thrive with a tiered or paid membership model. Selecting the right program type ensures that your loyalty program app development aligns with both your business objectives and customer expectations.

4. Decide on Features

Once the program model is clear, it’s time to narrow down your loyalty program app features.

A mobile loyalty program app must integrate features like points tracking, reward catalogs, push notifications, and user dashboards. You can also incorporate advanced features such as AI-driven personalization, gamification elements, and third-party integrations like payment systems or CRMs.

The features you choose directly influence customer engagement and the overall success of your custom loyalty app development project.

5. Design the UI/UX

No matter how good the rewards, customers won’t use the app if it is clunky. That’s why intuitive design matters.

Your loyalty app builder must pay attention to clean navigation, easy reward redemption, and engaging visuals. A seamless user experience keeps customers hooked and minimizes drop-offs.

6. Develop and Integrate Core Systems

Now comes the technical backbone of loyalty app development. Android & iOS app developers code the app, build the backend, and integrate systems like CRMs, POS (Point of Sale), and payment gateways.

Here, security and scalability are critical, particularly when you are anticipating large numbers of customers. This is also the stage where custom or white-label loyalty program app solutions are chosen based on timelines, budget, and business requirements.

7. Test and Launch

Prior to going live, testing should be done properly.

The QA teams perform feature-testing and bug-checking, ensuring the app runs efficiently on both iOS and Android devices. A soft launch with a small user group can give valuable insights into performance and usability.

Once everything is streamlined, it’s time to launch your loyalty program app and start promoting it to your customers.

Next, let’s examine the key attributes your customer loyalty app should have to keep users engaged.

What are the Key Features of a Loyalty Program App?

Building a loyalty app with the right set of features can turn an app into a growth engine for your business.

Let’s break down the must-have features that make a mobile loyalty program app remarkably effective.

1. Easy Onboarding & Registration

The process to develop a loyalty app should be based on fast sign-ups through email, phone, or social accounts. A convenient onboarding experience will persuade more customers to join your reward scheme instead of dropping off at the first step.

2. Personalized User Dashboard

The key component of any customer loyalty app is a well-designed dashboard. It should display users’ point balances, tier status, available rewards, and recent activity at a glance. The experience can be even more interactive by incorporating personalized recommendations tailored to past purchases.

3. Points & Rewards Tracking

Customers want clarity on how they earn and redeem rewards. Your loyalty program app should display points earned, expiry dates, and available redemption options transparently. This builds trust and motivates users to interact with the program regularly.

4. Multiple Reward Options

Not all customers value discounts. That’s why modern mobile loyalty program apps go beyond coupons and offer gift cards, cashback, exclusive access, or even charitable donations. Giving users choices makes them feel empowered and increases engagement.

5. Push Notifications & Alerts

Timely reminders keep your app top of mind. The user can receive information about the expired points, special deals, or personalized offers as a push notification. Done right, they make a customer loyalty app feel like a helpful companion rather than a spammy advertiser.

6. Seamless Redemption Process

Annoying redemption experience may spoil the loyalty experience. Your loyalty app development strategy should ensure users can redeem points in a few taps, whether online, in-store, or across partner brands. The secret of satisfaction is convenience.

7. Gamification Elements

Rewards should be made a fun process to increase participation. Gamification promotes regular app usage and helps ensure customers remain engaged. Features like challenges, badges, or spin-the-wheel rewards make a mobile loyalty program app addictive.

8. Social Media Integration

Modern loyalty is social. Allow users to post their rewards, achievements, or milestones on platforms like Instagram and Facebook. It is a win-win for both community-building and organic promotion of your loyalty program app.

9. AI-Powered Personalization

Advanced loyalty app development integrates AI to recommend rewards, predict customer behavior, and create hyper-personalized experiences.
For example, offering coffee vouchers to a user who regularly orders breakfast builds relevance and loyalty.

10. Analytics & Admin Dashboard

For businesses, the back-end is just as important as the front-end. An admin panel with detailed analytics helps track customer engagement, redemption rates, and ROI. This ensures your loyalty app builder efforts deliver measurable business impact.

Next, we’ll explore the cost of loyalty app development and the factors that influence it.

How Much Does Loyalty App Development Cost?

The cost of developing a loyalty program app depends on several factors, including complexity, design, tech stack, and more. On average, the cost to build a loyalty program app may vary between $10,000 and $120,000+. The complexity of the solution depends on how simple or advanced it is.

A simple customer loyalty app with basic features will sit on the lower end of the scale. On the other hand, if you’re aiming for an advanced mobile loyalty program app, the cost naturally climbs much higher.

Note: If you are launching a new venture or expanding an existing enterprise, choose to begin with a Minimum Viable Product loyalty app. It helps validate the concept, control costs, and collect real user feedback before scaling.

Several factors play into this cost.

The features of a loyalty program app are the most significant driver. The more intricate the system, the longer the time and expertise it requires to build. The choice of platform, the quality of UI/UX design, and third-party integration systems also influence the final price.

Remember, custom loyalty app development doesn’t end at launch. Maintenance, updates, and adding new features are ongoing investments that keep your app on track.

The price of the loyalty app does not necessarily mean how much you will spend to build it. However, the results achieved over time will be due to increased retention rates and the generation of loyal and repeat customers.

“Before you plan your budget, don’t miss our detailed guide on the cost to develop loyalty & rewards apps like Smile, it could save your thousands.”

What Tech Stacks are required to build a Loyalty Program App?

The right selection of tech stack for a loyalty program app will make it more reliable, and it can be launched within a matter of time.

Below are the prominent technology choices that you should use in a high-growth customer loyalty app.

Programming Languages: For native iOS and Android buildouts, Swift and Kotlin are perfect for custom loyalty app development to ensure speed and seamless performance. Flutter and React Native are great cross-platform solutions that help companies save money and go live quickly.

Backend Frameworks: A solid backend ensures your customer loyalty app performs smoothly. Node.js is famous for processing loads of requests. At the same time, Django and Ruby on Rails offer quick development and secure architectures.

Databases: Loyalty apps are data-intensive, from customer profiles to points tracking. Relational databases like MySQL and PostgreSQL guarantee precision. While NoSQL options like MongoDB offer flexibility for intricate rewards systems.

Cloud Platforms: Scalability is critical for loyalty program app development. Cloud platforms guarantee your app can manage thousands of users, real-time analytics, and secure storage without compromising performance.

Third-Party Integrations: A mobile loyalty program app needs smooth integrations with existing systems. Payment gateways simplify in-app transactions, CRM platforms enable personalization, and POS systems ensure real-time reward updates.

Analytics & Engagement Tools: Understanding customer behavior is key to retention. These tools help track app performance and user journeys, fueling smarter business decisions.

Security Protocol: Data security can’t be compromised. Implementing SSL encryption, OAuth for secure logins, and biometric features like Face ID or fingerprint unlock adds trust to your loyalty app builder strategy.

Industry-Specific Use Cases of Customer Loyalty App Development

Not all industries implement loyalty program apps in the same manner. The charm of customer loyalty apps is that they are flexible and can be customized to meet business objectives. Companies are utilizing mobile loyalty program apps to keep customers coming back. It amplifies consumers’ engagement and promotes repeat purchases.

Let’s look at the top industries where loyalty app development delivers the biggest impact.

1. Retail & eCommerce

Retail is the heartland of loyalty programs. A retail customer loyalty app monitors buying habits, rewards repeat shoppers, and sends targeted discounts.

Large eCommerce players leverage customized loyalty app development to drive special offers and repeat purchases. Take Amazon, for example: it’s not just about free shipping, it’s a loyalty-driven ecosystem.

2. Food & Beverage

Restaurants and cafes depend heavily on repeat business, so this sector is ideal for loyalty program app development. A mobile loyalty program app can reward diners with points, free meals, or exclusive access to new menu items.

Starbucks Rewards is one of the best-known loyalty program app examples, driving billions in revenue through gamified perks.

3. Travel & Hospitality

Airlines, hotels, and travel companies depend on loyalty for retention. Frequent flyer miles and tiered hotel memberships are classic models, now powered by loyalty app builders. Gamification and AI-driven personalization can keep brands like Marriott Bonvoy or Delta SkyMiles engaged with their customers even after their trips.

4. Healthcare & Fitness

Loyalty app for healthcare and fitness development shows a pattern of sustained growth. These apps are used by clinics, pharmacies, and gyms to reward patients for consistent visits, prescription refills, or achieving wellness milestones.

For example, many fitness brands incorporate gamified challenges into their customer loyalty apps to boost motivation and improve retention.

Why Choose Apptunix for Your Loyalty Program App Development?

Building a loyalty program app is more than just adding points and rewards. It involves providing a virtual experience to customers that retains them, builds your brand, and brings in repeat business. To achieve this, you need a team that understands both technology and its business impact.

At Apptunix, a leading mobile app development company, we specialize in loyalty app development tailored to your unique goals. Our experts craft solutions that go beyond templates.

Our solution enables customers to build a loyalty program app with sophisticated features that can seamlessly integrate with their existing systems. Whether you need a simple mobile loyalty program app to get started or a complex ecosystem serving multiple brands, we deliver all.

If you want to improve customer retention, increase revenue, and stay ahead of competitors, it’s time to take the next step. Let Apptunix turn your vision into a powerful loyalty program app that delivers measurable results.