Tiered Loyalty Program: What it is and how it works

Loyalty programs offer advantages for the public to create a bond of loyalty with the brand. Usually points are used that can be exchanged for products and services of the brand itself, or partner brands. Tiered loyalty programs have the same goal, but a different execution, creating categories for the customer, and the higher he is in the categories, the bigger and more exclusive are the prizes and advantages

To determine the user's position the brand uses its own metrics, for example: a client at the lowest level can win some percentages of discounts on certain products, and as he moves up the level he starts to win discounts, free shipping, exclusive gifts, or even products from the brand. Therefore, the more loyal the customer is to the company, the greater the benefits he will receive.

Why invest in tiered loyalty? 

A tiered system places benefits on all tiers, making all customers feel that they are covered, but the higher the user's position the better the benefit they will receive, thus creating the desire and will to continue consuming from the brand.

The company can decide in advance which actions will be rewarded with more points, such as sharing content or leaving product reviews, for example. This way it is also possible to decide how many points are needed to move up from one level to another

So with a tiered loyalty program, the brand can track and develop the most engaged customers, even separating out the level of engagement and working with a more personalized funnel. The tiers lay the foundation for long-lasting relationships, so they are a long-term investment to take care of current users while attracting new ones. 

The tiered loyalty program also helps maintain contact with the customer, creating more chances for interactions, as well as enabling the delivery of personalized communications, such as: level up opportunities; exclusive offers; news and updates. The closer contact also helps create an emotional connection with the brand

Tiered loyalty programs have many benefits for the company, such as: 

  • Improve Marketing ROI
  • Increase revenue
  • Build customer loyalty 
  • Boost brand awareness

How to create a tiered loyalty program

Tiered programs have many benefits, and in order not to overdo it when choosing how to create yours, just remember a few tips: 

  • Simplicity: There is no need to have a complex program, users must identify the rules to be part of the program, as well as what benefits they will receive at each level and how many points are needed to move up in rank. 
  • Relevance: Offer prizes that make sense to your customers and differentiated benefits, such as invitations to exclusive events, as well as gifts on special dates. 
  • Value: The biggest advantage of this type of program is that all users benefit, so all prizes and perks need to have value and improve as levels increase.
  • Gamification: It can be an asset to retain customers because it is fun for the public to find surprise gifts, win and receive bonuses, which engages customers and makes them stand out from the competition.
  • Behavior: Reward different ways the customer interacts with the brand, such as subscribing to the blog, using the app, downloading the e-book, sharing content, and so on.
  • Levels: Give different, creative names to the program levels, thus creating brand identification.

About Indico

Indico is a Brazilian Martech company with an experience that has reached more than 150 million customers in 9 countries, that develops solutions to combine Loyalty and Innovation creating unique connections between consumers and brands.

We create solutions that boost relationships and transform results. 

Disruptive campaigns, programs and projects that connect ideas, innovation, data and technology to engage, delight and retain customers. We generate data-driven insights and new opportunities, developing the customer experience with the brand. 

Contact us to find out how we can create more loyalty for your brand and boost your results!