The Power of VIP Perks and Exclusive Benefits in Rewards Programs
March 11, 2020
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Have you ever flown business class? Perhaps you’ve been invited to an important conference or special event to represent your employer, or received a backstage pass at your friend’s gig.
It’s nice to feel important. Regardless of what demographic you belong to, being treated like a VIP is appealing. As much as we all love a good discount, brands are quickly realizing that VIP perks are the fast-track to creating a unique and memorable customer experience for each individual member.
In fact, the airline and hotel industries realized this long ago. Think of how vastly different the flying experience is for the VIP passenger who enjoys skip-the-queue privileges, access to the airport lounge, priority boarding and priority meal service, compared to the “ordinary” passenger.
The same goes for the long-standing hotel loyalty program member who receives a free upgrade to a larger suite on a higher floor, a complimentary drink upon check-in (which they can do early if they like!), unlimited Wi-Fi in their room, free access to the conference room, and so on.
Perhaps the reason that hotels and airlines were the first to offer these enticing perks is that the customer experience lasts far longer in these sectors than in a shop, café or hair salon, for example. Airlines and hotels need to keep the customer or guest happy for the duration of a 20-hour flight, or three-night stay.
However, when considering customer lifetime value, your local coffee shop or beauty parlor has just as much at stake in every loyalty program member as international airlines and hotel chains do.
So how can shops, restaurants and other retail/hospitality businesses offer customers this same exclusive VIP treatment in their own way? Well, we actually have some thoughts on that…
Five Key Techniques for Using VIP Perks and Benefits to Drive Customer Loyalty
Whether you’re the proud owner of a small independent car wash business, or the CEO of a multinational café/fast food restaurant, there are things you can do to enhance your customer loyalty program without losing any money or hurting your bottom line at all.
Here are a few techniques that many businesses have already adopted to enhance the customer experience with VIP perks.
1. In-app Ordering & Payment, for Skip-the-Queue Benefits
Many bars and restaurants that see a high level of foot traffic have begun introducing in-app ordering and payment capabilities to encourage customers to order from their table. Not only does this reduce the amount of customers crowding the bar and impatiently waiting to place their order, but it inspires a sense of superiority among those enjoying table service.
It also increases the chances of diners deciding, “let’s have one more drink” or “let’s order dessert”, because they don’t need to get up and order at the bar, or wait for an employee to walk over and take their order.
Starbucks and McDonald’s are two notable fast-service restaurants that have embraced this strategy and incorporated it into their custom-branded loyalty apps.
2. The Personalization of Tailored Rewards
With a digital loyalty app, your business has access to valuable customer insights that allow you to determine which loyalty program members like certain things.
For example, a cafe can offer unlimited refills and Wi-Fi to their regulars who like to sit and do their work, while other customers might appreciate a complimentary slice of cake or a free upgrade to a larger size for their take-away coffee.
This technique offers something more personal than a mere discount, and it establishes that your business recognizes every customer is different, and treats them as individuals. By offering customers special perks that directly relate to them, you’re guaranteed to increase engagement.
Non-members are likely to see their fellow customers receiving these free refills and upgrades, and enquire as to how they can get access to these perks as well.
Brands like Sephora and Ulta Beauty offer highly engaging rewards program that see members receiving invitations to:
exclusive product launches
customized perfume-making classes
Customers can also use their accrued points to redeem experiential rewards like day spa packages.
While these kinds of perks won’t be applicable to businesses in certain industries, most brands can offer their customers experiential rewards in one way or another to increase their VIP status and convey gratitude for their loyalty.
For restaurants it might be invitations to trial brand new menu items. For supermarkets it might mean offering customers gold class movie tickets as a reward for accumulating X amount of points… get creative with it!This technique can be extremely effective when used in conjunction with the next strategy…
4. Social Media Engagement
Social media can be an invincible tool for promoting the exclusivity of a brand’s VIP club.By offering members additional rewards points for posting pictures and videos of themselves enjoying your program’s VIP perks, posted with all the relevant hashtags, you’re creating brand ambassadors.
People see these images of their friend/family member/colleague attending this exclusive event, or enjoying a personalized makeover or even simply a free refill at their local cafe, and they want the same VIP treatment.
Sephora and Starbucks are both notably proficient at inspiring this feeling of 'FOMO' (fear of missing out') through their customers’ social media pages.
5. Surprise & Delight
There’s no limit to the number of ways you can surprise and delight customers with spontaneous rewards that encourage them to feel appreciated and valued.
From a Birthday Club (a standard feature with most digital loyalty app providers), instant prize competitions (such as Stamp Me Loyalty Solutions’ Scratch & Win capability), and perks like “Double Point Tuesdays” and “Happy Hour Thursdays” to boost slow periods and encourage non-members to join for the perks, the list is endless. In fact, we wrote an entirely separate article on innovative rewards ideas.
Many brands will have “secret” incremental rewards built into their standard loyalty program structure, that customers don’t know about. This way, the customer is pleasantly surprised when they reach an unknown milestone in their points accruement and receive a reward.
Again, this is likely to incentivize other customers to ask, “why did they get that VIP treatment? How can I get the same treatment?”.
The more exclusive you can make your loyalty program appear, the more enticing it will be for any customer who becomes aware of it.
Your business might operate off a simple “Buy 6 X and Get Your 7th Free” model, but that doesn’t mean you can’t develop your loyalty program into a highly engaging VIP club that people are desperate to be a part of.
Many businesses use a tiered rewards system to cover all bases – the lowest tier is for those who want periodic discounts on repeat purchases, while the middle tier and “platinum” tier offer various combinations of the perks we’ve mentioned above.
The idea is that first-tier members will see the additional benefits and VIP treatment enjoyed by those in the higher tiers, and increase their brand engagement in order to get “promoted”.
How Can I Implement These Techniques into my Business?
Depending on your specific business type, size, budget and other important factors, this all might sound a bit overwhelming and complicated. After all, does a simple family-run business really need all these bells and whistles for its rewards program?
Thankfully, digital loyalty apps make it incredibly easy to offer various perks and benefits to your customers, directly to their devices.
Whereas these kinds of sophisticated digital rewards programs used to only be within reach of big-name brands, these days there are numerous digital loyalty app providers out there that can facilitate all these features to make your customers feel like VIP’s. All for a very manageable monthly subscription payments (usually $19-$49 a month).
When it comes to brand loyalty, VIP perks and exclusive benefits are an excellent way to offer customers a unique and memorable experience that they’ll consistently associate with your business.
INTERESTING VIP PERKS STATISTICS:
Two-thirds of consumers modify their spending in order to maximize loyalty benefits (Bond).
A CrowdTwist study revealed that free delivery is considered to be the #1 loyalty perk across all generations (CrowdTwist).
The same study found that 70% of Millennials are more willing to pay a premium in exchange for valuable perks like free shipping (CrowdTwist).
78% of loyalty programs offer experiential rewards (up from 61% in 2018) (Gartner).