Do Tiered Loyalty Programs Work?
Tiered Loyalty Programs can build real loyalty sentiment and boost retention by introducing a switching cost – members don’t want to lose their status. Each tier is achieved through a combination of spend and/or frequency, and benefits are progressively added for each threshold. The loyalty tier qualification criteria can be tweaked to enable a manageable audience for the most select benefits. Tier Based Loyalty Programs are a good fit for organizations that are well equipped to deliver the extra services – the highly competitive luxury department store sector provides useful insights and creative thought starters for this type of program. Nordstrom’s Nordy Club builds on their famous service heritage with benefits that keep high value customers coming back.