Step by step: The advantages of multi-level customer loyalty programs
Generate happy customers and increase your profits at the same time. Do you want to achieve this? Then ask yourself the following question: "What makes YOU happy?" Is it the appreciation of loved ones, your hard-earned status in your hobby/profession or is it even the simple things like a sunset with a good glass of wine?
Whatever it is: where there is happiness, there is also dopamine (colloquially: the happiness hormone). Dopamine is a substance that is produced by the body when we are exposed to particularly stimulating situations, such as training in the gym, at an awards ceremony or playing video games. The stimulus?
Dopamine is addictive to a certain extent, because we want to experience this feeling again and again. Companies that recognize our need for recognition, success and happiness can use this to make their customer loyalty programs more attractive.
Your secret: Multi-level customer loyalty programs
Simply explained, these are loyalty programs in which customers receive various benefits depending on their level of usage. This division into categories is important because not all customers are equally profitable. Rewards from customer loyalty programs should be distributed to all customers as fairly and according to performance as possible.
Why are these programs so effective?
1) Your customers spend more money playing games
Nintendo shows how it's done: Video games are designed to reward the player for every little activity. When the player reaches a new level, either by reaching a new area or skill, this results in an increased feeling of happiness.
It has been proven that customers spend more when they are about to reach a new level in the customer loyalty program. The effect: The cash register rings and happy customers are created.
2) Your own social media platform
A high social status is of considerable value to many people. People love to compare themselves with others to see where and how well they stand in the hierarchy of their social environment. With a multi-level customer loyalty program, you achieve two things:
Your customers will want to reach a higher level in order to receive better rewards, such as preferential treatment when shopping or price advantages.
Customers will want to improve their status and thus their prestige with the new rank.
Customers are doubly motivated to move up in the program. There is hardly any better motivation.
3) Your customers feel valued
The customer is king. Imagine that you visit a café, sit down at a seat and the waiter or waitress greets you by name, serves you a newspaper, croissant and your favorite coffee and wishes you a good start to the week.
This feeling will motivate your customers to want to move up to the highest, most elite level.
If you want to keep customers loyal, you have to come up with something to provide them with added value.
Multi-level customer loyalty programs are designed precisely to encourage customers to buy again and again, to convey a feeling of appreciation and to reward the best, most loyal customers appropriately.
This is how you create happy customers.
Author: Raphael-Geieregger, student at the University of Applied Sciences Upper Austria, Global Sales
