What loyalty steps should I choose?
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Modified on: Wed, 11 Dec, 2024 at 11:52 AM
Higher steps are more attractive. Incentivise potential customers by rewarding loyalty. The aim is to acquire new customers who will keep returning to you.
Top tips:
A. Choose step values that are higher than discounts you offer elsewhere.
B. A high Step 3 is crucial.
C. A high Step 3 doesn't actually equate to a high overall discount.
A - explained
If you choose step discounts that are only the same (or even lower) than any other discounts you currently offer (e.g. 10% off with newsletter signup), you risk customers being put-off from purchasing your vouchers. The higher the steps you are willing to input, the more attractive your vouchers will be.
B - explained
Step 3 is the first discount seen by potential customers in your campaign preview on the app and website, before they tap/click to see more of your campaign details.
C - explained
The average discount (average of all 3 steps) is lower than the Step 3 discount, and furthermore, only your most loyal customers will receive the Step 3 discount. Here's an example, assuming steps of 10%, 25%, 55%.
Customer buys Step 1 voucher: Average discount = 10%. (10%)÷1=10%
Customer buys Step 1 & 2 vouchers: Average discount = 17.5%. (10%+25%)÷2=17.5%
Customer buys Step 1 & 2 & 3 vouchers: Average discount is 30%. (10%+25%+50%)÷3=30%
While customers are incentivised to keep purchasing vouchers as the discount at Step 3 (55%) is much higher than the previous steps, the average discount is much lower. You can increase/decrease the average discount by increasing/decreasing steps 1&2.
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