Shop Cash for Retailers: How To Set It Up and Drive Sales

In today’s competitive online landscape, rising customer acquisition costs make a strong retention strategy a business necessity. Without it, businesses risk overspending to attract new customers while losing existing ones to competitors with more engaging loyalty programs.

Shop Cash, Shopify’s built-in rewards currency, addresses this issue by seamlessly integrating with pre-existing POS systems and online stores to help convert one-time buyers into long-term customers. For Shopify merchants, this program offers a strategic, native and powerful tool to increase lifetime customer value and help secure repeat business.

Read on to discover more about Shop Cash, its pros and cons, and how it works across POS and ecommerce, as well as best practices for driving sales.

What Is Shop Cash?

Shop Cash is a digital rewards currency and loyalty program developed by Shopify, one of the best retail POS systems on the market, and managed through the Shop app.

When customers make a purchase from a participating Shopify merchant, they can earn Shop Cash rewards, which are stored in their Shop Pay wallet. These rewards can then be applied as a discount toward future purchases at any other Shopify store that supports the program.

Customers can use the Shop platform to streamline the checkout process with any retailer that uses Shopify and participates in Shop Cash. This means the rewards you offer can attract new customers from the vast Shop app user base, in addition to rewarding your existing customers. Shop Cash works as a loyalty and retention program, as well as a potential customer acquisition funnel.

Benefits of Shop Cash

Using Shop Cash can offer numerous benefits for retailers seeking to expand their business and cultivate a loyal customer base.

• Drive repeat sales: The primary purpose of Shop Cash is to encourage return visits. Customers with a balance are reminded of their available rewards and are significantly more likely to return to your store to spend them. This can turn one sale into many and turn one-time customers into long-term supporters.
• Enhanced customer retention: Effective rewards programs can significantly impact customers’ decisions to choose your brand over competitors. It fosters an emotional and financial investment in your brand, leading to increased loyalty over time.
• Increased average order value (AOV): Customers using Shop Cash often spend more than the reward’s value. For example, a customer with $5 in Shop Cash is likely to make a higher dollar-value purchase or add additional items to their order, resulting in increased AOV and revenue.
• Improved competitiveness: Simply having a recognizable, easy-to-use rewards program can differentiate your business from competitors. It shows customers they’re valued and you’re invested in keeping them around, which is something not all small- to mid-sized retailers offer.

Drawbacks of Shop Cash

Shop Cash can be a powerful tool for online businesses, but it also has some drawbacks and potential pitfalls to be aware of.

• Risk of over-rewarding: Without clear rules, you could inadvertently offer rewards that are too high, cutting into your profit margins. It’s important to structure your earn rates, Shop Cash discount codes and redemption limits to ensure the program remains sustainable for your business.
• Not collecting data: Failing to monitor key metrics like, redemption rates, products purchased with rewards and the program’s overall ROI, means you’d be operating blind, limiting your ability to optimize your Shop Cash strategy — and your results.
• Customer uncertainty: While Shop Cash offers a simple and automated reward program, some customers may find it confusing. For instance, improperly applied rewards or uncertainty about how Shop Cash will handle returns can negatively impact their usage.
• Lack of brand exclusivity: Because Shop Cash can be spent at any participating merchant, you could inadvertently risk funding discounts for competitors. This makes a superior product and customer experience even more important to ensure customers keep coming back to your store.
• Inadequate staff training: If in-store team members don’t understand how Shop Cash works or how to guide a customer through the login or redemption process, you could end up with confusion at the point of sale and a poor customer experience, potentially negating the program’s benefits.

How Shop Cash Works Across POS and Ecommerce

One of Shop Cash’s greatest advantages is its seamless integration across multiple channels. The program is built into the Shopify ecosystem, meaning it works flawlessly across both your online store and your physical retail or restaurant locations via Shopify POS.

For example, if a customer earns Shop Cash through an online purchase, it’s instantly available in their Shop Pay wallet. If they walk into your brick-and-mortar store the next day, your staff can easily see their available balance right on the POS interface.

The customer can choose to redeem their rewards on the spot, applying the discount to their in-person purchase. Similarly, a customer who earns rewards in-store can later use them to shop online.

This universal access to Shop Cash balances creates a truly unified experience that many modern consumers have come to expect. It connects both digital and physical shopping, builds your brand, and encourages engagement across all your sales channels.

Step-by-step guide using Shopify POS

Enabling Shop Cash is generally a straightforward process within your Shopify admin profile. Follow these steps to launch the Shop Cash program confidently.

Step 1: Access your settings in Shopify Admin

Start by logging in to your Shopify Admin dashboard, then navigate to Settings > Customer Management > Loyalty. This dedicated section is your control center for all customer reward programs, including Shop Cash.

Step 2: Activate the Shop Cash program

Once you’re in the Loyalty section, you should see “Shop Cash” as an option to turn on or off. Toggle the switch to activate it. By doing this, you’re officially opting your store into the network-wide Shop Cash program and allowing customers to earn and spend their Shop Cash with your store.

Step 3: Configure your earning rules

Shopify may set a default earn rate, but it’s crucial to customize this to protect your margins. Determine a sustainable percentage, such as 1% or 2%, or a fixed amount per dollar spent. This rule dictates how much Shop Cash a customer earns on each purchase, both online and in-store.

Step 4: Set redemption policies

Establish clear rules for how rewards are spent. You can set a policy such as “Customers can use Shop Cash to cover up to 50% of their total order”. This prevents the entire purchase from being paid for with rewards, protecting your revenue and encouraging additional spending.

It’s important to remember that customers can earn Shop Cash at any enrolled Shopify store, and they can redeem that Shop Cash with your store. This could result in a situation where the Shop Cash wasn’t earned with you, but it was redeemed with you. This can significantly limit your profitability, making setting redemption limits — especially in the beginning — crucial.

Step 5: Sync and update your Shopify POS

Ensure your Shopify POS app is updated to the latest version on all store devices. The Shop Cash functionality is integrated into Shopify’s pre-existing systems and will automatically appear in the customer’s cart during checkout. No separate app installation is needed for the POS to recognize the program.

Step 6: Train your staff

This is the most crucial step for brick-and-mortar stores. Educate team members on how to apply Shop Cash at checkout, how to help customers with their Shop Cash login via the Shop app, how to redeem Shop Cash and how to explain the program’s benefits to drive enrollment clearly. Ensure cashiers and salespeople understand the Shop Cash workflow:

1. A customer provides their phone number or email at checkout, which staff can use to look up their profile.
2. The associate scans or manually adds items to the cart in the Shopify POS.
3. Before payment, the POS will automatically display any available Shop Cash balance the customer has and prompt the associate to apply it.
4. The associate should confirm with the customer whether they wish to redeem Shop Cash for the purchase.
5. The purchase can then be completed, with Shop Cash applied, if the customer chooses to do so.

Step 7: Perform test transactions

Before going live, conduct a mock sale. Use a test customer account, make a purchase to earn rewards and then process a second transaction to redeem them. This end-to-end test ensures the earn and redemption rules work exactly as you intended in a live environment.

Best Practices for Driving Sales With Shop Cash

While simply having Shop Cash is great, it’s not enough to effectively drive sales. It’s important to promote it to customers to maximize its impact. Here are some examples of strategies you should consider:

• Integrate with your checkout process: Highlight rewards at checkout, encouraging shoppers to apply Shop Cash to their order. Similarly, encourage sign-up for Shop Cash among non-users during checkout, clearly stating the benefits and providing a quick explanation of how to use it.
• Train staff to promote Shop Cash: Train staff to explain Shop Cash at checkout, asking customers if they’d like to sign up or apply their Shop Cash balance to their order.
• Implement upsell strategies: Online, use in-cart promotions or “people also bought” suggestions to increase order values. Train staff to make upsell statements to customers, such as, “Would you like to add X product for $X?” or “Right now we’re doing a sale on X product if you’d like to take a look,” when helping customers check out.
• Integrate with marketing channels: Consider promoting Shop Cash on social media, via email newsletters, on your product webpages and through SMS marketing with a concise explanation of how it works and its benefits to users.
• Promote seasonal Shop Cash offers: Drive traffic during high-sales periods by running limited-time promotions. For example, “Earn Double Shop Cash on all purchases this Black Friday weekend” or “Redeem your Shop Cash on our Holiday Collection, this month only”. This encourages customer spending during key sales seasons