Test a Loyalty Program With Promotions Before Launch

Testing a loyalty program with promotions means running a purchase-linked promotion, such as a receipt-based reward, a multi-step challenge or a sweepstakes, to learn whether customers will register, share data and buy again before the brand commits to a full loyalty program. It tests interest and operations, but not the program's long-term economics.

A loyalty program is a long-term commitment: rules, rewards, a platform, member service and, for points-based programs, a liability for points that members have earned but not yet used. Promotions share many of the same parts (registration, purchase proof, rewards, fulfillment and reporting), so a brand can use one to learn about its customers and its own team before building a program. This guide covers what a promotion can and cannot tell a brand, which promotion to run, what to measure, when to go ahead, how to carry participants into a program, the rules that differ, two examples and how to build in phases. It is written for consumer brands; B2B channel programs usually test with sales incentives instead.

Key Takeaways

What can a promotion tell you about a future loyalty program?

A promotion can show whether customers register, share data and respond to rewards, and whether the team can run it; it cannot show long-term behavior or program economics.

The biggest limit is that prize-driven entries are not loyalty. People who enter a sweepstakes may be chasing the prize, and a short promotion says little about whether earning points over months would change what they buy.

Which promotion should you run as a test?

Choose the promotion that answers the question: a receipt-based reward or multi-step challenge tests repeat purchasing better than a single sweepstakes.

• Receipt-based reward or rebate: shoppers earn a reward for qualifying purchases, which tests purchase proof and response to rewards.
• Multi-step or recurring program: customers earn over several weeks or complete several purchases or activities, which is closest to how a loyalty program works.
• Purchase-linked sweepstakes: purchases earn extra entries, and a free method of entry must earn the same number of entries. This tests reach and registration but mixes prize appeal with purchase behavior.
• Instant win game: shoppers find out at once whether they won, which tests repeat visits during the promotion.

A promotion that repeats or runs over several weeks tells the brand more than a single drawing, because it shows whether people come back. Run it long enough for a normal repeat purchase of the product to happen.

Brands with an existing customer email or CRM list can test more cleanly by offering a short earn-and-reward challenge to a random part of that list and comparing it with the rest.

What should you measure?

Measure registration, data sharing, receipt uploads and, above all, whether participants buy again after the promotion compared with similar customers who did not take part.

• Registration and completion: visitors who start and finish registration, and where they drop off.
• Data and consent: marketing opt-ins and completion of profile fields.
• Purchase proof: receipts uploaded per participant and the share rejected, and why.
• Repeat purchasing: purchases after the promotion by participants compared with similar customers who did not take part, where receipts, loyalty or retailer data allow it. Measure over a long enough window to get past any stocking up during the promotion, and compare each group with its own purchases before it.
• Operations: customer service contacts, fulfillment time and fraud cases.
• Cost: total cost per participant and per additional repeat buyer (repeat buyers above the comparison group's rate), including rewards, prizes, fulfillment, media and technology.

People who enter promotions may already be the brand's keenest customers, and matching on past purchases does not remove the difference in motivation. Where possible, hold the offer back from a random share of an existing customer list, or from a set of comparable stores or regions, and compare against that group. With a small number of participants, differences in repeat purchasing can be chance, so treat small tests as directional or run them longer.

Brands that sell only through retailers usually cannot see non-participants' purchases. Options include keeping a small receipt reward running after the promotion so participants keep uploading, comparing sales in stores or regions that ran the promotion with ones that did not, or using retailer or syndicated sales data where the brand has access.

The guide to running a loyalty pilot covers comparison groups in more detail.

When should you move to a loyalty program?

Move ahead when participants register, share data and buy again more than comparable customers, the team can run the operation, and the economics of a program look workable.

Set the thresholds for each of these before the promotion starts, so the result is judged against a target rather than read after the fact.

• Interest: registration and opt-in rates at or above the target set before launch, counting the opted-in base rather than total entrants.
• Repeat behavior: participants who buy again more than comparable non-participants.
• Operations: the team handled service, fulfillment and fraud at the promotion's volume.
• Economics: a program cost model the brand can sustain, built from the promotion's reward, fulfillment and service costs plus assumptions for redemption rates, points liability and platform costs. The promotion supplies inputs, not proof.
• Data: enough opted-in contacts to launch the program to an audience.

If participants entered but did not buy again, the promotion may still be worth running for reach, but it is weak evidence for a loyalty program.

A promotion costs less and runs faster than a pilot, but it answers fewer questions. A limited pilot of the actual program, in a few markets or for one customer segment, is the way to test earning, redemption and costs directly.

How do you carry participants into a loyalty program?

Plan consent and notices at the start, so participants who opted in can be invited to the program and their data used as they agreed.

• Consent: ask for marketing opt-in separately from entry, and describe how contact details may be used, including for a future program.
• Privacy notice: tell entrants how their data will be used and how long it will be kept.
• Invitation: invite opted-in participants to the program with a reason to join, such as starting points.
• Data: keep receipt and registration data in a form that can move into the program platform.
• Retention: set a retention period in the promotion's notice that covers the expected gap before the program launches, and keep the purchase fields read from receipts rather than the images where possible.
• Text messages: if the program will send marketing texts, collect that consent separately; the FCC's consumer guide states that "Commercial texts require written consent."

For a business covered by California's consumer privacy law, a loyalty program that offers benefits in exchange for personal information needs a Notice of Financial Incentive that explains "the material terms" so "the consumer may make an informed decision about whether to participate," and it must be "readily available where consumers will encounter it before opting-in" (Cal. Code Regs. tit. 11, § 7016). The test promotion can need one too: the statute provides that "A business may offer financial incentives, including payments to consumers as compensation, for the collection of personal information..." (Cal. Civ. Code § 1798.125), so entries or rewards offered for personal information may count.

Case study (disclosed by Brandmovers). For the Feeling Gerber Good sweepstakes, a promotion with no purchase involved, visitors could watch a daily video and then "register or log in to MyGerber for an entry into the sweepstakes." "Over 15k entrants submitted 62k+ entries during the month-long promotion. 1/3 of the entrants created new MyGerber accounts during the promotion period, and over 70% of entrants opted-in to receive future communications from Gerber on Gerber products and formula." That is the kind of registration and opt-in evidence a brand needs before inviting participants into a program; because entry did not involve a purchase, it says nothing about buying, and the case page does not report later purchases.

Which rules differ between promotions and loyalty programs?

Sweepstakes and instant win games need a free way to enter and may need state registration; a loyalty program needs its own terms and privacy notices.

• Free entry: under state lottery laws, a sweepstakes generally cannot require a purchase, and when purchases earn extra entries, the free method must offer the same number of entries. Florida's statute, for example, makes it unlawful "To require an entry fee, payment, or proof of purchase as a condition of entering a game promotion" (Fla. Stat. § 849.094), and the FTC's consumer guidance states the principle: "it's illegal to ask you to pay or buy something to enter or to increase your odds of winning."
• Guaranteed rewards: a reward every qualifying purchase earns involves no chance, so it is not a game of chance; Florida, for example, defines a game promotion as one "in which the elements of chance and prize are present" (Fla. Stat. § 849.094). Rebate and reward terms still need to be clear.
• State registration: New York requires filing for games of chance where the "total announced value of the prizes offered is in excess of five thousand dollars" (N.Y. GBL § 369-e), and Florida has a similar rule above $5,000.
• Loyalty program terms: a program sets how members earn and redeem, when points expire and how the program can change, which a promotion's official rules do not cover.

The 2026 sweepstakes and promotions compliance guide covers official rules and registration in more detail. This is general information, not legal advice.

What does a promotion test look like in practice?

A purchase-linked promotion can show reach, registration and receipt behavior, but the brand still needs purchase data after the promotion to judge loyalty potential.

Case study (disclosed by Brandmovers). For the DiGiorno Chaotic Good 'Stakes, a two-month sweepstakes tied to Marvel Studios' Deadpool & Wolverine, DiGiorno set out to "Capture first-party data for future marketing" and "Encourage product purchase and receipt uploads." Fans could register to enter and "Upload receipts for up to five additional entries, rewarding verified purchases," and the promotion drew "140k+ Total Entries." The case page says each entry and receipt upload helped the brand "understand who their pizza fans were, where they shop, and how often they buy." The page reports entries, not later repeat purchases, which is the gap a loyalty test would need to fill.

How do you build from a promotion to a program?

Expand in phases: from a single promotion to recurring campaigns that let registered customers earn over time, then to a program with the features it needs at launch.

1. Single promotion: test registration, purchase proof and operations.
2. Recurring campaigns: let registered customers earn across several campaigns, which tests repeat behavior.
3. Core program: launch earning and redemption for the behaviors the tests supported.
4. Added features: tiers, more ways to earn and integrations in later phases.

Brandmovers' Crawl/Walk/Run methodology, covered in the guide to modular loyalty programs, follows this phased approach. BLOYL™, Brandmovers' enterprise loyalty platform, includes a promotions builder for sweepstakes, contests, instant wins and bonus events alongside the loyalty program, with OCR receipt validation and A/B testing against a control group.

Conclusion

A promotion is a practical way to test whether customers will register, share data and prove purchases, and whether the brand's team can run a program, before committing to one. It cannot show long-term loyalty or program economics on its own. Choose a promotion that repeats, measure repeat purchases against similar customers, plan consent so participants can move into a program, follow the rules for each, and build in phases.

Sources

• California Code of Regulations, title 11, section 7016, Notice of Financial Incentive
• California Civil Code section 1798.125
• Federal Communications Commission, "Stop Unwanted Robocalls and Texts"
• Florida Statutes section 849.094
• New York General Business Law section 369-E
• Federal Trade Commission, "Fake Prize, Sweepstakes, and Lottery Scams"
• Brandmovers, DiGiorno Chaotic Good 'Stakes case study
• Brandmovers, Feeling Gerber Good sweepstakes case study