Boston Buyers Club

The paid loyalty program

December 17, 2016 by · Leave a Comment 

customer-loyalty-survey-cover7Written by Secure Net Shop

When it comes to loyalty programs, there are several types a brand can choose from. Often the choice will depend on the type of product or service on offer. The most popular (used by approximately 70%) program is the points based program. However, there is another program that is popular with larger retail outfits and luxury outfits, which is also a supported feature of most shopping cart solutions.: the paid loyalty program.

The paid loyalty program provides a sense of exclusivity to the customer. They gain access to special offers, discounts, and services only available to the program.  The eCommerce cart software will automatically show the customer the special offers that they are entitled to when they log in. One of the most recognizable examples of this is Amazon Prime.

Amazon has proven that the increased transaction value of a program like Prime is worth the additional overhead. Thanks to the free two-day shipping, Prime members spend significantly more than non-members. The upfront payment is usually a problem. Amazon uses a 30-day free trial to overcome to hurdle.

The benefits of this program are many. There is the higher spending per customer. Then there is the fact it is very easy to understand, unlike some of the tiered points based programs. There are also some drawbacks. The upfront costs will be a definite barrier to entry and only regular customers will see the value of the program.

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Secure Net Shop is a provider of shopping cart services for e-commerce sites.