How VIP program works?
How VIP Program Works?
Learn how to set up and manage your VIP Tier Program.
Introduction
In this article, we'll take a comprehensive look at managing your VIP program in our store credit platform. This tier-based loyalty system allows you to reward your customers with enhanced store credit benefits based on their spending levels. The system uses a permanent tier achievement model - once customers earn a tier, they keep it forever.
The VIP Tier Program automatically tracks customer spending and awards tier status based on cumulative purchase amounts since your program launch. Each tier can offer different store credit reward rates or fixed reward amounts.
How It Works
Fresh Start Approach
When you first enable your VIP program, all customers start at $0 spending regardless of their purchase history with your store. This provides a consistent starting point for all customers and allows you to measure program performance from the launch date.
Automatic Tier Progression and Permanent Achievement
Customers automatically advance through tiers as they reach spending thresholds, with no action required on their part. The system continuously tracks their purchases and upgrades their tier status automatically when they qualify for the next level. The system uses permanent tier achievement - once a customer earns a tier, they maintain that status and all associated benefits forever.
With permanent tier achievement, customers maintain their tier status once earned. Customers don't lose their achieved tier status or associated benefits.
Program Configuration
Spending Progress Reset Settings
The Spending Progress Reset determines when customers' accumulated spending toward higher tiers resets to zero, while their current tier status and benefits remain permanently intact. This approach separates tier achievement from spending progression.
Reset Option | Reset Schedule | How It Works |
|---|---|---|
Never Reset | No time limit | Customers continue accumulating spending toward higher tiers indefinitely. No spending resets occur. |
End of Calendar Year | Until December 31 | Spending progress toward higher tiers resets to $0 on December 31st each year, while customers retain their achieved tier status and benefits. This creates annual progression cycles. |
After X Months | Rolling monthly periods | Spending progress resets every X months from each customer's last reset, while maintaining their permanent tier status. This creates rolling progression cycles. |
Update your reset settings
- Go to your VIP Program settings
- Click Edit on Spending Progress Reset Settings
- Select your preferred reset method
- For monthly resets, specify the number of months between resets
- Click Update to apply the new settings
Important Note: Changing reset settings only affects future progression cycles. Existing customers maintain their current tier status and benefits, with new reset rules applying from the next reset cycle forward.
Tier Requirements and Structure
Each tier requires a minimum spending amount to unlock. You can set any minimum spending amount, including $0 for entry-level tiers that automatically include all customers.
Example tier structure:
Tier | Spending Requirement | Typical Benefits |
|---|---|---|
Bronze | $0 spent | All customers automatically qualify |
Silver | $250 spent | Enhanced store credit rates |
Gold | $500 spent | Higher store credit rewards |
Platinum | $1,000 spent | Highest-tier benefits |
Zero-Dollar Tier: If you create a $0 spending tier, all customers will automatically qualify for that tier and receive its benefits immediately upon joining your program.
The Permanent Tier Achievement Model
How Tier Persistence Works
The VIP program operates on a permanent tier achievement model, which determines how customers experience loyalty benefits. Once customers earn a tier, they maintain that status and all associated benefits permanently, regardless of future spending patterns, refunds, or program changes.
With this approach, customers maintain their tier status permanently, and merchants can track customer lifetime value consistently.
What This Means for Your Customers
When customers achieve a tier, they receive permanent access to all tier benefits. Their spending progress toward higher tiers may reset according to your program settings, but their achieved tier status never diminishes.
Handling Program Changes
Changing Reset Settings
When you modify your spending progress reset settings, existing customers maintain their current tier status and benefits. New reset rules apply only to future progression cycles.
Modifying Tier Requirements
Adjusting tier spending requirements affects only future tier qualifications - customers who have already achieved tiers maintain their status permanently. If you lower a tier's spending requirement, customers can only qualify for upgrades when they place new orders, never downgrades.
For example, if you change your Gold tier from $1,000 to $800 spent, existing Gold customers remain Gold customers, while customers with $800-$999 spent can upgrade to Gold with their next qualifying order.
Program Pausing and Reactivation
Disabling your VIP program pauses all tier calculations and progression tracking but preserves all customer data and tier statuses. When you re-enable the program, customers continue from exactly where they left off, maintaining their achieved tiers and benefits.
This allows you to make changes without losing customer data.
Refunds and Customer Experience
How Refunds Work with Permanent Tiers
With the permanent tier achievement model, refunds affect only spending calculations, not tier status. When customers receive refunds, their total spending amount decreases, which may impact their progress toward future tier upgrades, but never results in tier downgrades.
Refund Examples
Full Refund Scenario: A Gold customer who achieved their tier by spending $500 receives a full $200 refund. Their spending total adjusts to $300, but they remain a Gold customer with all Gold benefits intact. Their progress toward the next tier (Platinum) is recalculated based on the new $300 total, but their Gold status and benefits continue permanently.
Partial Refund Impact: When customers receive partial refunds, the system automatically adjusts their spending totals and recalculates progress toward higher tiers. Their current tier status and associated benefits remain unchanged.
Spending Calculation Details
What Counts Toward VIP Spending
The system tracks all completed order totals since your program launch or the customer's last spending reset, including taxes and shipping charges as they appear in your order totals. Refunded amounts are automatically subtracted to maintain accurate spending calculations.
What Doesn't Count
Purchases made before you enabled the VIP program don't count toward tier qualification. Pending or unfulfilled orders are excluded until they're completed, and refunded amounts are automatically deducted.
Customer Experience and Communication
Tier Visibility and Progress Tracking
Customers can view their permanent tier status in the store credit launcher, along with their current progress toward the next tier level. The interface shows that their current tier and benefits are permanent, along with their advancement progress since their last reset cycle.
Automatic Benefit Application
Enhanced store credit rates and tier benefits apply automatically to qualifying customers without any action required. Once customers achieve a tier, the system applies all associated benefits to their future purchases.
Benefits continue permanently once a tier is achieved.
Tier Calculation Timing
Tier calculations are triggered automatically by specific customer actions and system events.
When Calculations Occur
Order-Based Triggers: New order placements and order total changes (such as from refunds or modifications) automatically trigger tier recalculation to ensure customer status remains accurate and up-to-date.
Common Questions
What happens when I change my VIP program settings?
Program setting changes only affect future program behavior, never existing customer tier status or benefits.
How often are tiers calculated?
Tier calculations happen automatically when customers complete qualifying activities like purchases or when automatic reset events occur.
Can customers see when their spending progress will reset?
Yes, customers can view their progress toward higher tiers along with information about when their next reset cycle will begin.
Do customers lose anything when spending progress resets?
No, spending progress resets only affect advancement toward higher tiers, never current tier status or benefits. Customers maintain all achieved benefits permanently.
What are the benefits of permanent tier achievement?
The permanent tier achievement model means customers don't lose their tier status. Spending progress resets provide advancement opportunities while maintaining achieved tier status.
Updated on: 19/08/2025
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