The benefits of Tiered loyalty programs
Tier levels are associated with benefits, whose overall value increases after each use. Moreover, the higher the rank, the more exclusive the brand experience is.
Tier-based programs keep customers interested over a long period of time. Reaching a higher tier level feels like an achievement that motivates customers to keep ranking up.
Segment your customer base more effectively: monitor & analyze the activity and interests of your members. Improve the customer experience and provide highly targeted communication.
Preventing the loss of something valuable is more important than acquiring new things. That’s why members are just as focused on maintaining a tier as on reaching a higher one.
Distinguish your customer experience from the competitors’ with high-tier benefits. Also, the amount of effort needed for top tiers discourages high-spenders from switching.
Tiered Loyalty Program Examples
Tiers based on spend
Customers reach new levels by spending more: every tier corresponds to a specific spending milestone. However, using tiers based on spend limits the number of engagement touchpoints customers have with the brand.
Best fit for: Luxury brands and retailers
Tiers based on points
Customers advance through the ranks by making purchases and completing certain engagement actions, e.g. social shares, referrals, or product reviews. Customers receive a specific amount of points for each engagement.
Best fit for: Fashion & Lifestyle, Beauty, Athleisure, Home Decor
Who is it for?
Companies facing longer decision times and higher order values
Brands and retailers offering emotionally relatable products
Brands with positioning around a high-quality shopping experience