Points-Based Loyalty Program: How Points Work and How to Set Them

Updated 2026-10-23

Definition A points-based loyalty program gives customers points in proportion to what they spend, such as 1 point per S$1, and lets them exchange points for a reward, such as S$5 off for 100 points. The earn rate and redemption rate together set how much the customer gets back, here 5% of spend.

How does a points program work?

The customer earns points in proportion to what they spend. You set two numbers:

The earn rate. How many points each dollar earns. For example, 1 point per S$1.
The redemption rate. What the points are worth when spent. For example, 100 points = S$5 off.

Those two numbers decide how generous the program is. With 1 point per S$1 and 100 points worth S$5, a customer gets back 5% of what they spend. Raise the earn rate to 2 points per S$1 and they get 10% back. Work this out before launch, because cutting a reward later upsets your regulars.

A worked example

Customer	Spend per visit	Visits a month	Points a month	Value earned
Coffee regular	S$6	12	72	S$3.60
Family dinner	S$85	2	170	S$8.50
Weekend bakery shopper	S$22	4	88	S$4.40

All three get the same 5% back. A stamp card would treat the S$6 coffee and the S$85 dinner as one stamp each. That is the main reason restaurants and shops with varied bills choose points.

Points or stamps?

	Stamps	Points
Rewards	The visit	The amount spent
Easy for customers to follow	Very (“buy 9, get the 10th free”)	Fairly, if the reward is shown in dollars
Fair across small and large bills	No	Yes
Good for	One main product at one price	Menus and shelves with a range of prices

A café that sells mostly one drink at one price can run either well. Once the menu adds food, cakes or retail items, points keep the reward in step with what the customer spends. Our guide to loyalty programs for cafés covers that choice in detail.

What to watch when you set it up

Show the reward in dollars. “You have 340 points” means little. “You have S$17 to spend” brings people back.
Keep the first reward close. If a new member needs three months to reach anything, many stop counting.
Decide on expiry. Points that never expire are simple to explain. Points that expire build up as a cost you never pay out, which is called breakage. Tell customers clearly either way.
Let points travel. If you run more than one outlet, a customer should earn at one and redeem at another.

How Gimify handles points

Gimify is a points program. Staff scan the customer’s QR card, type the bill amount, and points are added at the earn rate you set. Points convert to dollars off at the rate you choose, and the system stops anyone redeeming more than their balance. Earning is always by purchase amount. Gimify does not run a per-visit stamp mode.

For the wider picture, see what a loyalty program is.

Questions owners ask

How many points per dollar should I give?

Set the earn rate and the redemption value together so customers get back about 5% to 10% of spend. For example, 1 point per S$1 with 100 points worth S$5 returns 5%.

Are points better than stamps?

Points are fairer when bill sizes vary, because a S$85 dinner earns more than a S$6 coffee. Stamps are simpler when you sell mostly one item at one price.

Should loyalty points expire?

Either can work. Points that never expire are easy to explain. Points that expire reduce what you pay out, but customers must be told clearly and given notice.

Can customers use points at a different outlet?

It depends on the program. A program with one shared balance lets customers earn at one outlet and redeem at another. Check this before choosing software if you run more than one branch.