E-commerce tips
The best 6 Shopify store credit practices and 3 proven strategies
By
Emma
on
Table of content
- 1. How to issue store credit on Shopify to a customer account?
- 2. The best 6 store credit practices to apply for your store based on your business goals
- 3. How to apply store credit practices for your store efficiently
Shopify store credit is becoming a new norm as it continuously starts showing the benefits, and various practices of application, in effectively improving the online shopping experience. From applying store credit in cashback, refund, to reward and promotion, store credit acts as a multi-functional hub that has helped to significantly boost both customer experience, and entrepreneur’s creativity in sale strategies.
Nevertheless, Shopify store credit is still a new definition that most merchants struggle to understand. People usually mistake the store credit concept with the old and traditional loyalty points. As a result, most merchants can use up to 50% but not the full potential of store credit.
In this article, we’re going to dive into the best of store credit practices and how to set up these best practices, to make the most out of this unconventional concept.
1. How to issue store credit on Shopify to a customer account?
If you are familiar with store credit, I’d recommend you to skip to the next part to straightforwardly continue your read on the best store credit practices and proven application strategies.
However, if you are new to Shopify store credit, then this section will guide you through two different ways to manually issue store credit from Shopify admin, or to automatically issue store credit by rules using 3rd-party apps.
1.1 Issue store credit from Shopify admin
Shopify has recently opened the early access of store credit to all merchants, and enabled it by default. Thus, you can issue store credit to your customer through the customer account in Shopify admin.
Here’s a step-by-step guide to help you issuing store credit from your store admin:
From your Shopify admin, go to Customers; then click the customer profile that you want to issue store credit for.
Click Edit in the Store credit section, then select Credit in the Adjustment section.
In the Amount field, enter the value of credit that you want to issue. (Optional: If your store accepts multiple currencies, you can select the currency that you want to issue in the Currency drop-down menu.)
In the Expiration date section, do either of the following:
To issue store credit that doesn't expire, select No expiry date.
To add an expiry date to the store credit, select Set expiry date, and then select an expiry date from the calendar. Learn more about store credit expiry dates.
Click Review changes, then click Credit {Amount} to issue the store credit.
1.2 Automatically issue store credit by custom rules with a Shopify app
Besides the manual issuing credit method, you can also try 3rd-party solutions to set up automatic programs with store credit, such as cashback with store credit, reward new customers on 1st purchase with store credit, etc.
There are multiple apps that have applied the concept of store credit into their technology, e.g. Rise.ai: Gift Cards & Loyalty, Synctrack: Returns & Exchanges, Okendo: Reviews & Loyalty, etc. However, if you only need a simple app for cashback and automate simple issuing flow for store credit, you can try out Koin Cashback & Store Credit - a free app with simple set up for cashback with store credit.
With Koin, you can easily create automatic cashback with store credit by setting up a program. The steps are simple, and it only takes you 5 minutes to fully set up a cashback program.
Step 1: Install Koin - Cashback and Store Credit
Step 2: Create your cashback program
From Koin’s dashboard, click Manage programs, then click Create in Cashback section.
Choose your program setting of cashback by product or by order.
Step 3: Set up your cashback rules
After choosing the program base, you can start setting up your program rules, including the amount you want to cashback per product or order, credit expiration date and program runtime.
2. The best 6 store credit practices to apply for your store based on your business goals
Besides the cashback program, Shopify store credit is expected to simplify the rewarding process, and to increase retention and loyalty organically, without the requirement to apply multiple promotions and loyalty programs together to retain customers.
From this part going on, we’re going to explore 6 best practices, which are divided into 2 main strategic goals, with practice idea explanations, that we recommend you try with store credit. The 2 main goals and 6 practice cases are presented as follows:
1st goal: To enhance customer loyalty and retention with store credit. Practices include:
Reward first-time buyer
Cashback by order to encourage customer returns
Handle returns and exchanges
2nd goal: To implement store credit in marketing and promotions. Practices include:
Increase product reviews
Promote new products, new arrival
Encourage customer’s referrals with store credit commission
2.1 Best store credit practices for customer loyalty and retention
Practice #1: Reward first-time buyer with store credit
Strategy: Reward new customers with a store credit amount.
Why it works:
Unlike discounts, when you offer your customers store credit, you’re offering them with actual money. By cashing back to new customers, it means they actually get a part of their money back, but it is held in your store digitally, and can only be spent in your store. This little tactic creates an urge in customer’s psychology, which pushes them silently and naturally to revisit your store for a second purchase to spend their store credit.
Thus, by rewarding first-time buyers with store credit, you’re actually raising a higher chance of customer return in the future, instead of just giving away discounts massively.
Practice #2: Improve customer returns for purchase with cashback by order
Strategy: Cashing back by order using store credit for later returns during low-sale period
Why it works:
It is well-known that consumers tend to wait until sales season to buy their favorite items which rarely get discounted during other times of the year. However, this shopping psychology makes it difficult for retailers when it isn’t sales season. Therefore, instead of giving a large discount during this sales season, you can combine strategies to apply discount and store credit at the same time, to resolve the double trouble of increasing sales during peak time, and maintaining sales during low-sale period.
For example, if you usually offer up to 50% discount during sales peak, you can reduce the discount to 20-30%, and offer your customers an amount of 20-25% of store credit cash back per order. This combination not only helps retail to keep customers’ joy of shopping and getting discounts, but it also triggers customer’s wish to return and spend their newly-earned credits.
Practice #3: Handle returns and exchanges with store credit
Strategy: Maintain customer retention and win back customer favor with a bonus of store credit
Why it works:
Whatever reason leads to a customer's request for return or exchange, it could leave that customer with an unhappy feeling of dissatisfaction. As a result, these customers tend to request a refund directly once their received package isn’t as expected. Reconverting customers that have requested a refund is difficult. However, if you can offer other options such as refund using store credit but with a bonus instead of the original order value, or exchange product with a reward of store credit, they can eventually give your business a second chance.
And, who knows? These customers might return and become your best loyal ones. And you actually can turn risk to real opportunity.
2.2 Best store credit practices for marketing and promotions
Practice #4: Increase product reviews through store credit
Strategy: Offer store credit when customers leave a review for your product
Why it works:
If you’re living or have been staying in Asian countries, you might have known that in these Eastern countries, the e-commerce marketplace and services are very popular. Not only that these e-commerce marketplaces grew by the increase of the number of businesses launching their store on these platforms, but the consumers also contributed to its growth, by highly engaging with the marketplace and the stores in it, including leaving their reviews on these e-commerce marketplaces after the purchase.
The secret behind this myth is simple. For each review is left, the customer will receive an amount of store credit that they can use on their next purchase. This simple but effective psychological strategy is a smart move when the store owner achieves two main goals: to get feedback from customers, and to keep customers loyal and ensure their return to use the earned credits.
Practice #5: Marketing new product with store credit
Strategy: Promote new arrival by offering store credit with product
Why it works:
While new products trigger the curiosity of consumers to buy and try out, some consumers have a psychology of fear when purchasing newly-released items. This feeling exists because they tend to feel afraid of spending an unworthy cash for a product that might not match their quality demand, without any guarantee of previous customer feedback.
To help this group of consumers make faster decisions for new products, you can encourage them by running a cashback program in a short term for the new arrival. For example, offering a 10% cashback for the new items isn’t a bad idea. It helps customers to feel assured that they get a bit of their money back while risking buying a new product. It’s like you’re offering a group of customers to try out your new products but they won’t leave hate comments even if the item doesn’t reach their expectation.
Practice #6: Craft a customer-refer-customer program easily with store credit
Strategy: Encourage customer’s referrals by sharing commission using store credit
Why it works:
The consumers are becoming smarter. Different from the past, where word-of-mouth marketing is favored, nowadays consumers require a commission in exchange if a business wants them to refer their friends and family members to try out its product. But at the end of the day, they are still your customers. This means that you can still reward them for their referral contribution, while ensuring that they will come back as your customer.
To apply this strategy tactic, you can simply run a program of rewarding store credit as commission for each referral. Additionally, to maximize the effect of this campaign, you can reward both the referrer and the referee, so that referees can be converted more quickly. This strategy helps to ensure that the referrer will receive their benefits, while the referee becomes your customers in a short time.
3. How to apply store credit practices for your store efficiently
3.1 Creating automated email marketing for store credit programs
From issuing store credit, informing the remaining amount of store credit after use, to reminding customers on the to-be-expired credits, these events need to be included and regularly sent through automated emails.
Why? The reason is simple. It creates a habit helping your customers to always keep their owned store credit in mind. The recommended emails might include but not limited to:
Moreover, these emails aren’t just automated event’s emails. Marketing and promotions content like new arrival, private online sale, etc. can always get stuffed in these emails. By adding promotional content, it naturally encourages customers to quickly visit the store and use their credits.
3.2 Promoting store credit offers across marketing channels
Besides forming customer behavior with store credit, you also need to promote it publicly on your marketing channels. Because to many consumers, the concept and definition of store credit might seem unclear and undefined. Thus, the idea of having store credit can be left uninterested if there aren’t any marketing campaigns surrounding this new concept.
If you plan to launch your first cashback program using store credit, an introduction to the concept is definitely essential. We suggest an outline of content to make it entice but still keep it clear and simple:
3.3 Optimizing website elements to showcase store credit offer
Finally, once you have your customers on your site already, don’t forget to remind them about the store credit they can get.
For example, if you’re running a program of:
Conclusion
Store credit is definitely a new creative concept for everyone, isn’t it? From purchasing their first item to returning for the next item of your store, store credit has a great potential to become one of the most creative tools that any store owners can use to grow their online businesses more efficiently. It can be flexible to play many roles in deciding and convincing your customers to take action.
The six best Shopify store credit practices we've explored demonstrate how versatile store credit can be—from rewarding first-time buyers to powering referral programs, each strategy addresses specific business challenges while creating value for both merchants and customers.
And, that is why store credit is showing its powerful impact in customer journey, from marketing and conversion to customer loyalty.
Don't wait to harness the power of store credit in your Shopify business. Even a small step can lead to significant improvements in customer retention and sales. Your competitors may already be using these strategies—start building your store credit advantage now.
-About Author
Emma C.
As the Chief Marketing Officer at KOIN app, I’m here to build a robust ecosystem by collaping with Shopify apps. Together, we can create seamless integrations that add more value to our shared customers.
KOIN helps merchants retain customers, increase repeat purchases, and drive loyalty by offering cashback and store credit rewards.
📩 Let’s connect! emma@getkoin.io
