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Pricing for Square Loyalty for existing sellers

This post was created from an existing thread: Important Update for Loyalty: Add multiple rewards, customize your Loyalty terminology and more


Fees for the Square Loyalty Program have gone up dramatically (https://squareup.com/help/us/en/article/6382). So, the more loyalty customers you have, the harder it will be to administer them, and the more you will have to pay. We were already thinking of eliminating the Square Loyalty Program because of the increased burden of managing it.

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Re: Pricing for Square Loyalty for existing sellers

First of all, I’m sorry for the confusion around this topic. I’d like to start by clarifying that pricing is not currently changing for existing Loyalty customers.

 

As you’ve seen, we’re testing a new Loyalty pricing model for new customers that sign up for the program. If you already have a Loyalty program, there is no change to your pricing happening in 2018.

 

I’d also like to give a little more insight into what’s happening behind the scenes. The Loyalty team is testing a participation-based pricing model that is based on the number of loyalty visits per month. The reason behind this shift: based on program usage data and seller interviews, they have learned that pricing by location does not best align the price of a loyalty program to the value sellers receive. They are exploring different ways to find a pricing model that is the right fit for the variety of businesses we serve, as we have businesses of all sizes and complexities using Loyalty. With this new participation-based pricing model, the hope is that many businesses will benefit by only paying for a loyalty program when it’s working for you and your customers. The monthly price would adjust based on your monthly loyalty program participation across all your locations.

 

Since the team is in the testing phase with this pricing model, they are collecting feedback and will make a longer-term decision about pricing after gathering additional data and hearing directly from more Square sellers. Thank you for sharing your thoughts here in the community - our Loyalty team is reading each of these responses. Additionally, Darsh on the Loyalty team will be conducting phone calls to gather more feedback with anyone here willing to talk with her. If you’re interested, please schedule a feedback appointment.

 

I can imagine that if you are a current Loyalty subscriber, seeing these new pricing tiers is somewhat shocking and surprising, based on the increase in price that some of you would see under the new model. The team remains very mindful that this new pricing model could have large increases in pricing for some of you and they are continuing to collect feedback to understand the impact before any changes are made. In the event that we do decide to change pricing, you will have months of advance notice and we will notify you directly. We understand that your business needs time to adjust to any substantial change like this.

 

Again, I’m sorry for any confusion and thank you all for working with us to find the right fit for pricing.

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@zder  OMG!!  I had NO idea that the pricing structure had changed!!  I don't remember seeing any of THAT information in any of these "update" notifications.  We're already in the $125 a month range apparently...Holy cow!  We're cancelling this NOW!!  Thanks for pointing that out!!

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I didn't get an email on the price increase either! Shocked to read the article! Thanks for pointing that out! I am on the lower end of the pricing structure, but all the changes to the Loyalty Program is getting harder for me to manage. I now have to keep an eye on it and go in and manage it manually. I'm thinking punch cards would be easier.

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Shell Shock!!  Just saw the massive price increase!!  https://squareup.com/help/us/en/article/6382

 

If this is accurate, then all this is academic, it's no longer a cost-effective program.  Think about it, those are MONTHLY costs... it's crazy.  It's especially not worth it when it doesn't even offer proper functionality.  We'll go back to using punch cards.  

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Super Seller

WOW!! had NO idea of this new pricing. That would put us at $250 a month ..NO WAY!  We have Square Loyalty, Marketing, Payroll, Gift Cards and Square Capital. If we drop ALL services we still can't paid $250 for Loyalty. If this pricing is correct I assume we will have to start looking outside for all of these services.

 

Why as Square gone radio silent on this thread?

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Super Seller

Another punch the the gut of our Loyalty Program. New pricing https://squareup.com/help/us/en/article/6382

If this is correct, it will put us currently at $250 a month!!  

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The biggest problem for a small organic upstart is overhead and most of us have websites that ALSO have newsletters (for marketing that have a much higher turnover rat  and use email marketing that reaches our customers such as constant contact , mail chimp and etc, etc. I think this is new tier is terrible cost wise and is way too high of a cost for bsuiness that rely on square. I can easily just opt my customers out of square and go to Shopify. If this is a “required function” then we will leave. This is too expensive for what it really offers. I think square needs to calm down on its fees because we all will find more affordable and alterante POS and marketing avenues. 

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Square Folks,

 

Square sellers pay for additional services based on features, functionality, and quality. I have no problem paying more for excellent products and services. In my opinion, the new Square Loyalty features were not well designed or implemented. Now that I see that they come with a hefty price increase, I am wondering if the price increase was the main 'feature', and the other features were hastily added to justify the new price.

 

I remind Square staff that there is another higher-level Loyalty Program at play here - that between Square Sellers and the Square company. Many of us came here from legacy POS systems and Credit Card Processors that gave us bad products, bad service and questionable fees. This is part of the history of Square's success -  it offered a breath of fresh air for those stuck with the old way of doing things.

 

I have been considering other Square services, like Payroll, but now I fear that any competitive low prices to get customer buy-in may likely be increased significantly in the future once the customer is committed, and the switching cost is high. I am saddened at this focus on new and increased fees without a corresponding focus on quality.

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I agree. I used to love how refreshingly clear Square was and didn't hesitate to sing their praises to anyone who would listen, to get them to switch. And many people did- they trust that I had direct experience with Square. (and no, I didn't go through the channels to get "credit" for getting someone to sign up- I just really liked Square). Now I don't feel that same transparency. For example, just today I was talking to a woman who owns a very busy hair salon and she was asking me who I used and if I would recommend them. I told her I would wait, that they are doing some changes and may end up being like the "other companies" all of us here have switched from. I hope Square doesn't sink in the hole and lose that breath of fresh air that we all have come to trust. 

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Zder, you hit the nail right on the head. This smells just like the legacy cc processing tactics that we all moved to Square to get away to get away from. We were attracted to the company's transparency and simple pricing model. The beauty of a competitive marketplace is that we always have choice. While it's true, switching can be very painful, if we're pushed far enough (because we're suddenly being gouged) we'll leave in droves. Think about that, Square.  

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Unbelievable...

 

I understand that cost increases are part of being a business owner. I expect that most everything will gradually increase in cost over time. But this is a 400% increase, and an unannounced one at that. Whenever this takes effect, we will jump from paying $25 a month to paying $125 a month for the same service. Yes, our loyalty program does drive additional business. But we already incur training and labor costs to develop and implement it. Would I have signed up for this last year knowing that Square was going to be charging us $1500 per year to run the loyalty program for us? No. We signed up after being told it was $300 a year.

 

I would fully understand if the message was "hey, we are experiencing some cost increases, so we have to increase our rates, but here's what we are going to do to make the product better for you". But this is just "we know you agreed to $25, but your new price is $XXX."

 

We paid over $15,000 in Square fees last year, and the switching costs for us are high. But decisions like this one will weigh heavily in whether we stay.

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@Helen, why was my post removed from this thread? It definitely wasn't spam. My original post started this conversation.

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Alumni

Hi @zder - Our spam filter is automated so it sometimes catches the wrong things (even after they're posted, which is super annoying). I found your comment in the filter and released it. Sorry about that!

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@katieand,

 

Thank You!

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Totally agree.  Our numbers are very similar.  

 

And with all the overhead required to manage this new system, the cost-benefit ratio goes way down. From a business model perspective, Square should really provide this service free of charge, since the overhead on their end is minimal (once the system is properly built) and it drives more customers which in turn drives more revenue for Square (assuming the majority of transactions are CC).  I could understand charging more for high-cash businesses, but for operations like mine, where we get ~90% CC transactions, it just drives more revenue and we all win. With all the new charges and surreptitious increases, it really makes you question the long-term strategy here.

 

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Alumni

First of all, I’m sorry for the confusion around this topic. I’d like to start by clarifying that pricing is not currently changing for existing Loyalty customers.

 

As you’ve seen, we’re testing a new Loyalty pricing model for new customers that sign up for the program. If you already have a Loyalty program, there is no change to your pricing happening in 2018.

 

I’d also like to give a little more insight into what’s happening behind the scenes. The Loyalty team is testing a participation-based pricing model that is based on the number of loyalty visits per month. The reason behind this shift: based on program usage data and seller interviews, they have learned that pricing by location does not best align the price of a loyalty program to the value sellers receive. They are exploring different ways to find a pricing model that is the right fit for the variety of businesses we serve, as we have businesses of all sizes and complexities using Loyalty. With this new participation-based pricing model, the hope is that many businesses will benefit by only paying for a loyalty program when it’s working for you and your customers. The monthly price would adjust based on your monthly loyalty program participation across all your locations.

 

Since the team is in the testing phase with this pricing model, they are collecting feedback and will make a longer-term decision about pricing after gathering additional data and hearing directly from more Square sellers. Thank you for sharing your thoughts here in the community - our Loyalty team is reading each of these responses. Additionally, Darsh on the Loyalty team will be conducting phone calls to gather more feedback with anyone here willing to talk with her. If you’re interested, please schedule a feedback appointment.

 

I can imagine that if you are a current Loyalty subscriber, seeing these new pricing tiers is somewhat shocking and surprising, based on the increase in price that some of you would see under the new model. The team remains very mindful that this new pricing model could have large increases in pricing for some of you and they are continuing to collect feedback to understand the impact before any changes are made. In the event that we do decide to change pricing, you will have months of advance notice and we will notify you directly. We understand that your business needs time to adjust to any substantial change like this.

 

Again, I’m sorry for any confusion and thank you all for working with us to find the right fit for pricing.

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Thank you @Kpay !!  This is helpful information.  The pricing tiers still seem very tight for the new model, and regardless, it seems this pricing schedule will make new potential users not want to join your program.  Looking forward to seeing what else the team decides!

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Super Seller

Yes thanks for clarifying. We would have to cancel all services we're currently using, which are Square Marketing, Square Payroll, Square Gift Cards and we would still be paying more. We also use Square Capitial. Honestly we where fine with the old program.

 

In 2017 we paid over $1,500 in service fees. Under new pricing model it would be over $4,000. This is not including Square Capitial and card fees.

 

You want to go to tiered pricing, why not offer tiered programs. The flat rate of $25 or even $50 for the basic original loyalty program that most of us where good with. And tiered pricing for the expanded program with multiple rewards etc.

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@Kpay,

 

Thank you the information.

 

I have scheduled a feedback appointment.

 

 

 

 

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@Kpay

 

Thank you for clarifying - much appreciated. I booked an appointment as well, thanks for making that available to us. I appreciate the cost structure will not change in 2018, but we're already in Q3, so I'm more concerned with what might happen in 2019. Minor rate increases are understandable (though I still see this as a mutually beneficial program that should be without additional charge) but I'm concerned that a major change is coming to the pricing model. I agree with the others that anything close to the tier pricing structure that was presented is impossible to absorb – and it absolutely makes no business sense. Since establishing a Loyalty program is an incredibly difficult program to "unwind" with our customers, I fear that once it's been established, we're very much at the mercy of Square's discretion - and this is very disconcerting based on recent trends and events. As others have stated, we all left previous POS systems / CC processors to work with a more transparent and trustworthy partner, and landed on Square. It would appear that lately - with all the changes, fees for services, price increases, additional charges, etc. - that Square may be moving away from that partnership relationship with its sellers, and losing sight of what brought us all here. I can say that if I ran my business in this adversarial manner, we would not be around very long... someone always comes along to fill the service void in a free market. We like Square. Please don't lose the awesome philosophy of partnership that brought us all here.


Thank you!

 

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@brick,

 

Well said!

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