LoyaltyNov 14, 2021

How to boost engagement in your loyalty program with membership tiers

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Imane Kabbaj
Membership tiers illustration

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How Consumers View Loyalty Program Tiers (Graphic: Business Wire)

Tiered loyalty programs create a sense of fairness and equality, since membership levels are usually achievable through the purchase of certain items or completion of specific actions.

Customer Engagement & membership tiers
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Brands should carefully balance between the benefits obtained from membership tiers and their costs when setting a membership fee.

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Keep in mind that to encourage customers to join your program and climb up the ladder, you need to set small and achievable targets for your loyal customers, without altering or complicating the program.

Another approach is to figure out the future customer profitability is by applying the metric of customer lifetime value (CLV).

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With that being said, the costs of running your loyalty program should not outweigh the program's benefits. If you don't connect your loyalty program to customer profitability, you'll lose money over time (e.g., CLV, Attitudinal and behavioral loyalty & profitability).

Ideally, you should aim for differentiated membership tiers from your competitors, offering benefits that customers find delightful and interesting.

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You can't be afraid to review and change membership tiers as you continue to grow and evolve your membership program. However, don't make changes too often as it can be confusing and frustrating for your membership base.

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Imane Kabbaj

Marketing Manager at Loyaly & eCommerce growth specialist. I believe that retention is the new acquisition, and online customer loyalty programs make it possible.

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