Green Loyalty Programs: How to Drive Sustainable Customer Engagement?

To operate and grow, a business should be honest and make sustainable choices. It should also share the same values as its customers, not just in statements but in actions. Have you ever wondered how your company can build lasting customer loyalty? Read our article to learn how to create initiatives that not only will help the environment, but also increase customer satisfaction and positively impact your business.

Building customer engagement and loyalty starts with providing value to customers and showing them that they can make a difference. An example of such an activity is Green Loyalty, which allows you to combine customer engagement with actual environmental action.

What is Green Loyalty?

Green Loyalty is a program that rewards customers for environmentally responsible purchasing decisions and behaviors. Under this program, customers receive benefits for choosing green products and services and for taking actions that have a positive impact on the planet.

Green loyalty programs engage customers in environmentally responsible actions by encouraging them to make conscious consumer choices. This can include choosing green products, recycling packaging, reducing carbon emissions, or supporting environmental organizations. Through green loyalty, consumers not only benefit from products and services that align with their environmental values, but also receive rewards and benefits that increase their engagement and loyalty to the brand.

Why is Green Loyalty important?

The 21st century is the era of conscious consumerism. Environmentally conscious consumers now consider not only quality and price, but also the ethical and environmental impact of products. According to our global Customer Loyalty Predictions 2025 report, sustainability is an important shopping factor for 64% of international shoppers. Moreover, consumers are willing to pay up to 52% more for sustainable services and products—and up to 77% in the UAE!

Green Loyalty is the answer to the demands of the modern consumer. Today's customers are not only more aware, but also demand a fair approach. Green loyalty programs are one of the latest loyalty trends. Meeting their expectations will bring many benefits to the brand.

• Positive impact on brand reputation - A green image can be a powerful competitive differentiator. It's worth investing in such initiatives, as up to 80% of consumers prefer sustainable brands. Many customers are also willing to pay more if the product is sustainably sourced.
• Impact on consumer behavior - Sustainability is increasingly important for shoppers and can actively change their behavior, especially among younger generations. Implementing environmental initiatives and sustainable loyalty programs can deliver far greater benefits to the brand than traditional loyalty programs.
• Positive impact on long-term business growth - Companies that prioritize sustainable development and customer loyalty are more likely to succeed in the long run. It's definitely worth the effort, as sustainable business practices can reduce operating costs by up to 60%.

Green loyalty has a positive impact on the functioning of a brand in every aspect, from building customer loyalty to operational aspects. It is particularly important in the context of the younger generations, who are just entering the job market and therefore have their own means and make independent consumer choices.

2025 Trends in Green Marketing Across Generations

Research shows that Gen Z and Millennials consumers care about sustainability and are significantly more concerned about the environmental impact of their choices. To reach them, companies must operate in a way that aligns with their lifestyles and encourages ethical consumer choices.

• Gen Z leads in supporting sustainable initiatives beyond reducing plastic waste. 26% opt out of services like inflight food, extra towels, or unnecessary product packaging, while 16% support companies using renewable energy. Additionally, 9% pay attention to ethically sourced food and clothing, such as bananas, chocolate, and rubber.
• Millennials prioritize sustainability slightly more than Gen Zers. 68% consider sustainability when shopping, 67% are more likely to join a green loyalty program, and they are the most likely generation to switch or stay loyal to a brand based solely on its sustainability practices.
• Gen X, in some areas, cares about sustainability even more than Gen Z. For example, 63% are likely to join a loyalty program from a brand that prioritizes sustainability (compared to 61% of Zoomers). 60% want their loyalty programs to include sustainability features, such as carbon offsetting or eco-friendly rewards.
• Baby Boomers are the least influenced by sustainability efforts. Nearly 45% firmly believe in reducing plastic waste, a stance that may seem outdated to younger generations. They are willing to pay 36% more for green products and services, yet 54% have never switched or stayed loyal to a brand solely because of its sustainability practices.

Green Loyalty: Challenges

Balancing Transactional and Emotional Loyalty

• Challenge: Loyalty programs typically reward customers for transactional behavior (purchases), but promoting sustainable actions can sometimes contradict this approach. Encouraging customers to make eco-friendly choices while focusing on transactions can be difficult to reconcile with fostering emotional loyalty.
• Solution: Set realistic goals that engage customers in achieving both transactional and sustainable outcomes, such as offering incentives for sustainable behavior alongside regular purchases.

Aligning Sustainability Goals with Business Objectives

• Challenge: Integrating sustainability into business operations can be complex, particularly when trying to balance profitability with eco-friendly practices.
• Solution: Establish clear, realistic sustainability goals that align with business objectives, such as reducing waste or promoting the resale of used and refurbished products at a discounted price.

5 Short- and long-term benefits of Green Loyalty

The benefits of Green Loyalty for companies are numerous and can have a significant impact on their long-term success. Here are some key benefits:

1. Building a positive brand image: Moving to a green approach in loyalty programs can enhance a brand's reputation as environmentally responsible. Customers are more likely to choose brands that demonstrate a commitment to the environment, which can help build a positive brand image.
2. Increased customer loyalty: Sustainability-oriented loyalty programs can effectively increase customer loyalty. The importance of customer loyalty is significant because it provides a competitive advantage in many aspects of business.
3. Stand out from the competition: In today's world where more and more consumers are becoming environmentally conscious, brands that offer green loyalty programs can differentiate themselves from the competition. This can lead to benefits such as attracting new customers and retaining existing ones.
4. Cost savings: Loyal customers are willing to spend more with a brand they feel an emotional or value connection to. Loyalty programs based on green values can therefore help increase customer lifetime value and profitability for the company. While initial investments in green loyalty programs may be higher, the long-term financial benefits can outweigh these costs.
5. Positive environmental impact: Transitioning to green loyalty programs can help reduce the negative impact of a company's operations on the environment. This can include promoting sustainable products and services, encouraging customers to make green choices, and reducing resource and energy consumption.

Sustainability Features in Loyalty Programs

For 60% of consumers, sustainable features in loyalty programs are important. Additionally, 31% want to see sustainability-focused rewards in loyalty programs in 2025 and beyond, particularly in countries like the US (50%), UAE (47%), and Brazil (40%).

While carbon offsetting as a way to spend loyalty points is still relatively low, it is gaining traction in countries like Switzerland (4%), Germany (2.4%), and Saudi Arabia (1.2%).

Green features are making their way into loyalty programs, and brands should implement specific strategies to differentiate themselves by offering something unique that competitors may not have considered yet. The possibilities for these features are virtually limitless:

Does sustainability increase customer loyalty?

Customers aligned with a brand's environmental values tend to exhibit higher loyalty and make more frequent purchases.  Studies indicate that up to 60% of Americans view climate change as a significant concern, implying that adopting environmentally friendly practices can enhance brand perception.

Our research shows that customers care enough about a brand’s sustainability efforts to be willing to switch brands because of them.

Green Loyalty can bring many benefits to companies, including reputation, customer loyalty, increased sustainability awareness and social and environmental responsibility. As a result, more and more companies are choosing to implement green loyalty programs as part of their business strategy.

How Industries Can Explore Green Loyalty

In many industries, especially those facing social and regulatory pressures, there is a growing interest in implementing innovative loyalty programs that encourage environmentally responsible behavior among customers. However, creating an effective green loyalty strategy can be challenging because each company operates differently and each loyalty scheme targets different types of customers. Here are some practical tips to help you navigate the realities of your business.

Fuel industry:

• Rewarding green choices, such as using electric car chargers, with discounts or points.
• Offering benefits related to environmental support, such as donations to environmental organizations.
• Rewarding the recycling of fuel packaging with points or discounts. Special collection points for such packaging can be set up at the station.

Fashion industry:

• Rewarding purchases of clothing from eco-friendly lines
• Rewarding customers for bringing in used clothing for recycling
• Offer special deals on refurbished used products that cannot be sold as new

Food industry:

• Rewarding customers for using reusable packaging, such as offering discounts on products like fruits and vegetables
• Encourage the purchase of local and organic products through loyalty programs
• Encourage the purchase of food that is still edible but nearing its expiration date to reduce food waste.

Tourism industry:

• Reward customers for traveling by low-impact modes of transportation, such as trains, public transportation, or choosing electric cars over gasoline vehicles.
• Offer special discounts to customers who choose green alternatives that are tailored to their interests, such as offers for using electric cars.
• Offer customers discounts for group travel to fill all seats in a vehicle and reduce the carbon footprint per person.

Tech industry:

• Rewarding customers for recycling used electronics through special loyalty programs
• Offer discounts on the purchase of green technology products, such as energy-efficient appliances or smartphones made from eco-friendly materials.
• Encourage digital green behaviors, such as using e-invoices instead of paper bills, for which customers can earn bonus loyalty points.

How To Build A Green Loyalty Program

Creating a sustainable loyalty program can be a critical step for companies looking to engage customers in environmental action. Here's a step-by-step guide to help you build such a program:

1. Choose sustainable actions to reward
   Select green actions that align with your brand's mission and character. Determine which specific green behaviors you want to encourage through your loyalty program. You can reward customers for offsetting CO2 emissions from travel, recycling used products, or other sustainable practices.
2. Choose a Loyalty Program Software
   Choose a software that gives you the flexibility to configure your loyalty program to include environmental actions. Utilizing the services of an experienced and reputable loyalty program provider is key to success. It allows you to focus on building customer relationships while the provider handles the technical aspects, such as maintaining the IT infrastructure.
3. Select rewards for customers
   Determine what rewards you want to offer customers for their sustainable actions. This could include loyalty points, discounts on future purchases, free shipping, or exclusive offers for loyalty program members.
4. Customize communication
   Tailor your customer communication to promote your green loyalty program. Send out information about rewards, encourage customers to participate in green activities, and emphasize the value of their commitment to environmental goals.
5. Measure results and make improvements
   Monitor and measure the results of your loyalty program on a regular basis. Analyze which actions are most effective and adjust the program based on the data collected.

Creating a green loyalty program can not only increase customer engagement, but also help your company achieve sustainable development goals.

6 Real-world examples of green loyalty programs

Creating a successful green loyalty program that reflects the character of the brand is no easy task. But with the right effort, it's possible to develop a program that perfectly complements the brand's brand values, and effectively engages customers. A common element used in such campaigns is the green reward.

What is an example of a green reward?

An example of a green reward could be incentivizing environmentally friendly customer behaviors with discounts or points that can be redeemed for rewards. These behaviors can include using reusable packaging or choosing environmentally friendly alternatives.

Here are examples of the best green loyalty strategies that demonstrate why it pays to invest in sustainable business development:

1. Costa Coffee

• Why we love it: Reusable cups
• Description: Costa Club Loyalty Scheme rewards customers with extra points ("green beans") for using their own reusable cups. Points can be redeemed for a free coffee.
• Impact: Encourages frequent store visits and boosts revenue. Promotes the use of branded reusable cups, enhancing brand visibility and positive environmental associations.

2. Patagonia

• Why we love it: Worn wear recycling
• Description: Customers can bring used Patagonia clothing to stores and earn points to purchase new items or repaired products at a discounted price.
• Impact: Reduces textile waste, promotes sustainability, and encourages the purchase of eco-friendly products.

3. REI

• Why we love it: Used equipment exchange
• Description: Members earn discounts and gift cards by exchanging used outdoor equipment.
• Impact: Fosters a community of environmentally-conscious outdoor enthusiasts and promotes the reuse of outdoor gear.

4. Madewell

• Why we love it: Old jeans recycling
• Description: Rewards customers with discounts for returning any old jeans, which are then used to make home insulation.
• Impact: Promotes textile recycling and sustainability in fashion, while providing customers a way to reduce waste.

5. EILEEN FISHER

• Why we love it: Clothing donation
• Description: Customers can donate gently used clothing in exchange for early access to new sustainable collections and fashion workshops.
• Impact: Engages customers in environmental stewardship and rewards them for sustainable actions.

6. Tentree

• Why we love it: Tree planting with purchases
• Description: For every purchase, Tentree pledges to plant ten trees, allowing customers to track the progress through the Impact Wallet app.
• Impact: Encourages customer participation in reforestation efforts and celebrates eco-friendly behaviors.

7. TK Maxx

• Why we love it: Eco-friendly rewards
• Description: Offers customers rewards like bamboo straws and reusable items. Customers can donate rewards to charity.
• Impact: Builds loyalty through environmentally-conscious rewards and supports local communities.

Discover the potential of green loyalty programs with Comarch!

Green loyalty programs based on sustainable practices are becoming a key tool for companies aiming to build a loyal customer base and promote sustainable development. By acting in line with environmental values and supporting sustainable practices, brands can build stronger relationships with customers and gain their trust.

Want to create your own sustainable loyalty program and gain an edge over the competition? Get more sustainability data from our free report or contact us today to learn more details and start building your green loyalty strategy together with Comarch!