A loyalty program is a rewards program offered by company to customers for their regular purchases .It offers customers an opportunity to engage across a diverse portfolio of partner brands with options to earn and spend points and avail rewards .Loyalty programs run on a loyalty cards, points card, rewards card, club card, or advantage card and are visually similar to a credit card or debit card that identifies the card owner as a member in a loyalty program. On each purchase the member gets reward points on the basis of the amount spent and these points can be redeemed in terms of discounts, services, and many other ways except for cash back. Loyalty programs in India are offered by PAYBACK, the largest customer loyalty program in India.
1. Point Based Loyalty Programs :
This is the most common loyalty program where customers earn points based on amount spent on purchases. Collecting a certain number of points means that the customer is eligible for the services mentioned in the program like, free and discounted products or special promotional items.
2. Lifestyle Loyalty Programs :
These types of programs are made for a small but very loyal customer base. It rewards the people who like to use your service and builds a community.
3. Tier Based Programs :
Tiered loyalty programs are similar to points systems, but members can upgrade their level through continued involvement, collected points or taking a membership in the program. The difference between the points system and the tiered system is that customers extract short-term versus long-term value from the loyalty program. You may find tiered programs work better for high commitment, higher price-point businesses like airlines, hospitality businesses, or insurance companies. These programs are excellent in making a brand loyalist feel special. Members get to decide and take action on rewards choices by reaching up to the next level or redeeming their points now.
4. Community Based Programs:
A community based loyalty program is in sync with already established groups and communities within a local area. Customers can use their loyalty point with existing organizations for discounts on products that member are more likely to use.
5. Coalition Based Programs:
A coalition type of loyalty program brings in strong relationships with brands which are a part of your lives. They add value to the purchases made by the loyalists by giving them points on purchases made on the brands they use every day.
6. Hybrid Point Based Programs:
This type of program is made to reward premium customers who have added value to the brand products or service. It is relevant to both value oriented customers and lifestyle/service oriented customers. Loyalty programs can be of great help and benefit for the customers so consider and check what type of loyalty program are you using and how can you reap more benefits out of it.
Source by Heena Khan
