A customer loyalty program is a marketing strategy for increasing the loyalty customers share with your brand. If you visit this website you would learn more about how to execute a successful model.

There are different models of the customer loyalty program and there are instances where some businesses make use of one model for their reward system.

At the end of this piece, you should have more information about the different models available and choose the one(s) that resonates with your brand.

  1. Point programs
  2. Cash-back loyalty program
  3. VIP-membership loyalty program
  4. Value-based loyalty
  5. Tiered loyalty program

Point programs

This is the oldest form of reward program. Since it has stood the time of life, it can be concluded that it works. The model is based on earning points for every dollar spent.

The more money the buyer spends, the higher the points they earn. Once it reaches a certain point, the customers can redeem the points for a reward.

Tiered loyalty programs

This is a loyalty program system that involves ranking customers based on how they engage with the brand. Here, the metrics for ranking customers could be by how many purchases are made or how often they engage with the brand.

The higher the rank, the better the perks lined up.

Cash-back loyalty programs

This loyalty program shares the same basis as that of the points program. The difference between the two is the difference in reward. 

The participants in the bonus points program stand the chance of winning various rewards but in the case of cash-back programs, the reward is in the form of cash or coupon that the customers can spend at designated centers.

Value-based loyalty programs 

This program is aimed at helping customers achieve their charitable goals. For instance, the fashion power brand, TOMS, does this best — They promise to donate a pair of shoes for every shoe purchased.

Customers who desire to improve society would gladly participate in this kind of program.

VIP-membership loyalty program

This loyalty reward system offers the participant access to an exclusive community where members enjoy special services, discounts, or unique opportunities.

The benefits enjoyed by members of the VIP clubs should be unique and must not be easily accessed by others unless they live up to what’s required to get that access.

Answers To FAQs About Customer Loyalty Programs

What are consumer loyalty programs?

This is a promotion technique deployed by many businesses that desire to increase customer retention via repeat purchases from existing and new customers. The potential for reward is why many people participate in these programs.

How do you create a customer loyalty program?

Before you execute a customer loyalty program, do your research. Study the market, industry, and your competition. 

Now, study the behaviors of your customers. Using the information from your research as a basis, you can create a goal for the loyalty program.

Finally, design the program and then launch. But before a large scale promotion, test its acceptance with a small group.