Tiered loyalty program
What is a tiered loyalty program?
A tiered loyalty program is one of the most common types of loyalty programs in which customers are placed into different tiers based on their level of engagement with a brand. These tiers typically offer different benefits and rewards, with higher tiers offering more valuable rewards.
In a tiered loyalty program, customers can move up or down in the different tiers based on their level of engagement with the brand. For example, a customer who makes a lot of purchases with a brand might move up to a higher tier, while a customer who does not engage with the brand as much might move down to a lower tier.
What types of behavior are usually rewarded by a tiered loyalty program?
Several types of behavior are usually rewarded by a tiered loyalty program, including the following:
Making purchases: One of the most common behaviors that are rewarded by a tiered loyalty program is making purchases with a brand. Customers who make a lot of purchases with a brand are often rewarded with higher tier status, which can provide them with access to more valuable rewards and benefits.
Spending a certain amount of money: In addition to making purchases, a tiered loyalty program can reward customers who spend a certain amount of money with a brand. This can be measured over a specific period, such as a month or a year, and can be used to determine a customer's tier status.
Engaging with the brand on social media: Many brands also reward customers who engage with the brand on social media, such as by following the brand on Twitter or sharing brand-related content on Facebook. This can be a valuable way for a brand to build a community of loyal customers and encourage them to engage with the brand.
Referring friends and family: A tiered loyalty program may reward customers who refer friends and family to the brand. This can be a valuable way for a brand to grow its customer base and reward its loyal customers.
"A loyalty program helps you build relationships through offering value, like sharing related or complementary products to customers who have already tried your offering. Strategic, regular touchpoints will increase your customer’s lifetime value and your margin. It’s win-win!"
 "Felipe-Silberstein_Apply_Digital")
Felipe Silberstein
Head of Platform Strategy at Apply Digital
10 things to do to run a successful tiered loyalty program
A tiered loyalty program is one of the most effective ways to drive long-term customer engagement, increase lifetime value, and reward your best customers. When done right, tiered loyalty motivates progression, builds emotional loyalty, and creates clear differentiation between casual and high-value customers. These ten principles will help you design and run a successful tiered loyalty program.
1. Define the role of tiers in your loyalty strategy
Before designing tiers, be clear about what they should achieve. Tiered loyalty programs are best suited for encouraging repeat behavior, increasing spend frequency, and retaining high-value customers. Make sure tiers support these goals instead of adding unnecessary complexity.
2. Create clear and meaningful tier levels
Each tier should feel distinct and purposeful. Customers must easily understand how many tiers exist, what each tier represents, and how they progress from one level to the next. Avoid overlapping benefits that make tiers feel interchangeable.
3. Make progression rules simple and transparent
Customers should always know how to move up a tier. Whether progression is based on spend, points, visits, or actions, communicate the rules clearly and consistently. Transparency builds trust and reduces frustration.
4. Design benefits that increase with each tier
Higher tiers should unlock increasingly valuable rewards. This can include better discounts, exclusive access, priority support, or special experiences. The perceived value gap between tiers is what motivates customers to strive for the next level.
5. Reward status, not just discounts
Tiered loyalty programs work best when they tap into status and recognition. Benefits like early access, VIP treatment, or exclusive content often feel more meaningful than monetary rewards and are more sustainable long term.
6. Show customers their tier progress everywhere
Visibility is critical for tiered loyalty success. Customers should see their current tier, progress, and next milestone across all relevant touchpoints, including website, app, email, and checkout. Progress awareness drives action.
7. Use tier expiry to encourage ongoing engagement
Tier expiration or requalification periods create urgency and prevent stagnation. When customers know their status must be maintained, they are more likely to stay active. Communicate expiry rules clearly and provide reminders well in advance.
8. Personalize rewards by tier level
Different tiers have different needs and expectations. Tailor rewards, messaging, and campaigns to each tier to increase relevance. Personalization makes customers feel understood and reinforces the value of their tier status.
9. Test tier thresholds and benefits regularly
A successful tiered loyalty program evolves over time. Monitor how many customers reach each tier, how quickly they progress, and how benefits are redeemed. Adjust thresholds and rewards based on real performance data.
10. Align tiered loyalty with the overall customer experience
Tiered loyalty should feel like a natural extension of your brand experience. From tone of voice to reward types, ensure tiers reinforce your brand values and customer promise. Consistency strengthens trust and long-term loyalty.
)
What are the benefits of a tiered loyalty program?
There are several benefits of a tiered loyalty program, including the following:
Improved customer engagement: A tiered loyalty program can help to improve customer engagement by encouraging customers to engage more with a brand to move up to higher tiers and access more valuable rewards and benefits. This can lead to increased customer loyalty and higher conversion rates.
Increased customer spending: A tiered loyalty program can also help to increase customer spending by rewarding customers who spend a certain amount of money with a brand. This can be a valuable way for a brand to grow its revenue and increase its market share.
Better customer data: A tiered loyalty program can also provide a brand with better customer data. By tracking customer behavior and engagement, a tiered loyalty program can help a brand to understand its customers better and to tailor its marketing and sales efforts accordingly.
Enhanced brand reputation: A tiered loyalty program can also help to enhance a brand's reputation. By rewarding its most loyal customers with valuable rewards and benefits, a brand can demonstrate its commitment to its customers and build a community of loyal and engaged customers.
Check out our report, "Loyalty strategies for 2026" to see how leading brands are rewarding customers and driving pipeline.
)
