Establishing an earn structure determines how members will engage with your rewards program. Engagement builds stronger relationships, which in turn, enables a loyalty program to ask more of their users. The way users engage is changing within the reward landscape, making the structure of a program that much more important.
Let’s take a look at a couple of basic program earn structure possibilities and how they work:
- Points-based – Members accumulate points and use them to redeem items of their choice.
Achievement-based – Member earn pre-determined rewards that appear during an activity.
Both of these structures can encompass several different types of rewards. Some examples include: merchandise, product discounts, digital downloads, donations, and event tickets.
The main difference between the above structures is how and when the reward item is displayed to the member, which is either via a traditional reward shopping experience using earned points or displaying rewards to the member after an achievement.
Both types work perfectly well in terms of building engagement, but the way a program is set up determines which earn structure is best suited for said program.
How points-based structures work
Members earn points for any activities that the program deems valuable. This can be swiping a credit card, flying with a particular airline, or even sharing content. Points are credited to the member’s account and the member redeems them for merchandise, gift cards, tickets, and more.
How achievement-based structures work
Achievement based rewards track user activity and timing, instead of points, and offer a reward for an achievement or “engagement” when a particular action is made or completed by a user. It is up to the program how and when the achievement based rewards are shown.
For example, a member sets a goal to beat their previous mile time in a running app and receives a Footlocker discount, or a free Powerade. Some of the rewards can be served immediately, while other rewards might require a zip code or an email for targeting purposes.
Which structure is right?
There is no right or wrong when it comes to deciding between points based and achievement based rewards. The determining factor is what kind of program structure works best for a given business. An argument can be made for both points based and achievement based structures respectively. A better question to ask might be, “What rewards platform gives me the ability to set up a program however I like, and provides the ability to customize how rewards are redeemed by a user?”
When considering the earn structure of your program, think about how the member engages with the app or website at a high level and offer rewards that compliment the natural engagement flow. In doing so, you will come to find which reward structure is appropriate for your program and the level of engagement you are looking to achieve.