Building a VIP Membership & Subscription Experience: Q&A with Inveterate

Our friends at Inveterate are changing the game when it comes to membership and loyalty programs for DTC brands looking for a competitive edge.

We sat down with the team to unpack the strategies brands need to consider when building a meaningful loyalty program.

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Q: How do you assess the long-term value of a member, and what actions should a new brand take to maximize this value over their customer lifecycle?

Inveterate: Loyalty should never be seen as a one-and-done transaction with your customer. We like to think of loyalty as a journey, where every stage is an opportunity to engage your customers and grow their loyalty to your brand. In fact, at Inveterate we define each shopper cohort as being within a loyalty journey and assign unique benefits to them. 

For instance, members of a free loyalty program may receive free shipping and special discounts. As they reach a certain spend level, they’ve unlocked a free gift. Then they decide to pay for a premium membership and start receiving store credit on every purchase. Each of these stages along the journey provides a more relevant and valuable experience for all your shopper cohorts and ultimately incentivizes them towards greater loyalty. The most important thing a brand can do is to understand their shopper cohorts to define the unique benefits that will drive them toward greater LTV.

Q: How do membership and loyalty programs fit into an omnichannel experience for brands selling both online and in retail?

Inveterate: Memberships can be a great strategy for omnichannel brands. The convenience of retail can sometimes cannibalize online business, so brands need to find a way to keep the DTC side of the business distinct and valuable to customers in order to continue online growth. Membership programs do just that. The valuable benefits that are only available online as a member, like member discounts or special events, incentivize your best customers to buy online and to keep coming back. We saw this with the Sichuan chili sauce brand Fly By Jing, which had a DTC business challenged by higher operating costs and the threat of cannibalization by retail. By starting a membership program, they offered an array of valuable perks online and saw order frequency increase by 52% by members. The revenue impact by members continues to increase as time goes on too, which is a great indication of the incremental growth they will see with their DTC business.

Q: How should eCommerce brands blend membership and subscription programs to complement each other, and can you give examples of brands that do this well?

Inveterate: Memberships and subscription programs are not mutually exclusive! At the end of the day, customers want to be able to control when and how they purchase. By combining memberships and subscriptions, you’re providing that flexibility to your customers. Better yet, brands can allow members to apply their membership benefits, like discounts or exclusive products, to their subscription purchases, so that neither is cannibalized by the other.

This is especially important for products that might not be used at the same rate across the customer base. One great example was with the natural skincare brand Bambu Earth. They had a successful subscription program, but with customers refilling products at different rates depending on their skincare routines, they wanted to provide a program with more flexibility. They created a membership program where customers paid $40 a month and received $40 in store credit, which could be compounded and used on any purchase throughout the year, including on subscription purchases. Customers loved the flexibility, and Bambu Earth saw an increase of $126 in gross revenue per member. 

Q: How does Inveterate offer a unique membership experience that excites modern consumers, compared to traditional loyalty programs?

Inveterate: Customer acquisition is becoming increasingly more costly, so the importance of building a differentiated product and a genuine, recurring customer relationship has resurfaced. In the past, brands have turned to points-based loyalty programs to solve their customer engagement and retention issues. The problem is these types of loyalty programs reward behavior that would have happened anyway – there is no commitment or incentive that encourages staying loyal to your brand. These programs are also becoming so ubiquitous in the industry, customers barely notice or remember that they are part of them, and if they do, then there is often a high amount of confusion around how to use their points.

Inveterate provides a more holistic loyalty solution, which transforms customer behavior and drives incremental growth. First off, membership benefits are immediate to customers (they don’t have to wait to accrue points over time), so we see higher new customer acquisition. Then there is value provided to these customers on every purchase after that with store credit or cash back and exclusive perks. This transforms customer behavior since you’re no longer just rewarding routine behavior, but instead providing an incentive to spend more, more often.

Better yet, as these customers engage with your brand in different ways (like reaching a certain spend tier, leaving product reviews, or ordering a certain number of times), they can receive new benefits – moving your best customers along a loyalty journey that drives even higher brand affinity and incremental growth.

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To learn more about Inveterate, check them out here. For more information on our first-to-market integration with their team, read more here!