LatestTypes of Loyalty Programs
How to achieve a beneficial loyalty program? By understanding what mechanic works best for the customers. Are they eager for points, discounts, or maybe cashback?
How to achieve a beneficial loyalty program? By understanding what mechanic works best for the customers. Are they eager for points, discounts, or maybe cashback?
Below are the most common types of loyalty programs. However, your program can be more successful by mixing mechanics and creating a combination that fits both your company and customer.
1. Points based: Just Earn and Burn
This is the most common type. Members accumulate loyalty points on their accounts and redeem them for reward from the gift catalogue.
2. Tier-based: Tier equals status
With each tier, members receive higher value benefits that are more exclusive. With this approach customers feel highly appreciated and eager to become brand ambassadors.
3. Cashback: The more you spend, the more you get
Usually, this discount is a percentage of the total sum of spending. The discount is applied for future transactions, so the customer has a motive to come back for more.
4. Premium: Exclusive paid club
An interesting and quite new approach to loyalty. This type allows companies to create the most exclusive experience with sophisticated benefits, as the revenue stream is secured by members' fees.
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