Summary

On this page, you will find a comprehensive overview of the various use cases relevant to the Tier v2 program. These use cases cover a wide range of scenarios that illustrate how members move between tiers - both through upgrades and downgrades - based on their activity and eligibility.

Each use case is designed to provide clarity on the specific conditions under which a member's tier can be upgraded or downgraded. Additionally, the examples explain the criteria required to retain a tier, and what happens when those conditions are not met.

This detailed guide will help you better understand the logic and behavior behind tier movements, ensuring transparency in how the Tier v2 program operates.

Use Cases

Consider a program that has four tiers: Red, Silver, Gold, and Platinum, with the spend thresholds: 0, 300, 600, and 1200, respectively. The time frame for tier evaluation is one year from the last tier change date.

Now, let’s examine different use cases in which a member's tier may be upgraded or downgraded based on specific conditions.

Use Case 1: Large Purchase at the End of Membership Year

A member was opted into the program with the Red tier on January 3, 2022. They made a purchase of $250 on January 9, 2022, but their tier was not upgraded because the spend threshold for the next tier was set to $300. Then, they made a purchase of $1,100 on February 28, 2022, and they qualified for the Platinum tier. The retention period for the Platinum tier is one year. This member did not make any purchases after entering the Platinum tier, due to which their tier was downgraded to Red at the end of the retention period.

Use Case 2: Purchase After Tier Reset

In the following case, a member was opted into the Red tier on January 7, 2023. They made purchases on January 8, 2023, and again on January 2, 2024, which qualified them to be upgraded to the Silver tier and then the Gold tier. To maintain this tier, they needed to make purchases totalling $600 within a year from the date of the upgrade. However, they did not meet this requirement, leading to a downgrade to the Red tier. After the downgrade, they made a purchase of $300, which allowed them to be upgraded to the Silver tier once again. 

Use Case 3: Order Cancelled While on Hold

When a member places an order and their reward points are still on hold, and later the order is cancelled, there will be no change in the member’s tier status. For example, consider a member who was opted in on May 1, 2024, at the Red tier. They later purchased a product for $700, but their reward points were on hold, which prevented their tier from being upgraded. When the order was cancelled, the member remained in the Red tier. 

Use Case 4: Order with Redemption

A member was opted into a loyalty program on October 1, 2023, earning a Red tier status. They made a purchase of $700 on October 15, 2023, which promoted them to the Gold tier. After this, they redeemed 200 points, but their tier was not downgraded since the redemption was in points and the tier threshold was based on spend amount. 

On January 5, 2024, they made another purchase of $80, but there was no change in the tier because the spend threshold for the next tier was $1,200. However, on October 15, 2024, their tier was downgraded to Red because they did not meet the required spending amount of $600 within the retention period to retain Gold tier status. 

Use Case 5: Tier Downgrade Due to a Partial Return

Consider a program that has three tiers: Silver, Gold, and Platinum, with the spend thresholds: 0, 300, 600, respectively. The time frame for tier evaluation is Tier Earned Date to 365 days.

In this case, a member was opted into the loyalty program on April 4, 2025, at 13:34:01 and was assigned to the Silver tier. They made a purchase of two products priced at $300 each on April 4, 2025, at 13:35:07. On April 4, 2025, at 13:39:12, the order was shipped, and the member’s tier was upgraded to Platinum. Later, on April 5, 2025, at 13:39:12, the member returned part of the order, resulting in their tier being downgraded back to Silver. The tier was downgraded because the member no longer met the criteria for the tier.

Use Case 6: Tier Downgrade Due to Full Return within Retention Period

Consider a program that has three tiers: Silver, Gold, and Platinum, with the spend thresholds: 0, 300, 600, respectively. The time frame for tier evaluation is Tier Earned Date to 365 days.

In this case, a member was opted into the loyalty program on April 4, 2025, at 13:34:01 and was assigned to the Silver tier. They made a purchase of a product priced at $600 on April 4, 2025, at 13:35:07. On April 4, 2025, at 13:39:12, the order was shipped, and the member’s tier was upgraded to Platinum. Later, on April 5, 2025, at 13:39:12, the member returned the product, resulting in their tier being downgraded back to Silver. This occurred because the member did not satisfy the condition to remain in the Platinum tier, even though the tier retention period is one year.

Use Case 7: Tier Changes Based on Purchase and Return Activity Within Retention Period

Consider a scenario with three tiers: Tier 1, Tier 2, and Tier 3. Each tier is defined based on the member's cumulative spend within a calendar year (January 1 to December 31).

• Tier 1 is the default entry tier with a threshold amount of 0.
• Tier 2 is achieved when a member spends $500 or more.
• Tier 3 is the highest tier, requiring a minimum spend of $1000.

Each tier has a retention period of 1 year. Once a member qualifies for a tier, they retain that status for a full year, even if their spending falls below the threshold in the following year. At the end of the retention period, the system evaluates the member’s spending again to determine whether they will stay in the current tier, be upgraded, or downgraded.

The tier time dimension used in this scenario is the Calendar Year (January 1 to December 31), and all spend calculations and tier evaluations are based on this timeframe.

Member Tier Change Scenario:

1. Enrollment and Initial Tier Assignment

• The member enrolled in the loyalty program on January 15, 2020.
• Upon enrollment, the member was assigned to the default Tier 1.

2. Tier Upgrade to Tier 2

• On December 24, 2020, the member made a purchase of $550.
• This purchase qualified the member for Tier 2, having met the required threshold of $500.
• At this point, the retention condition did not yet apply, as the retention period begins only after the end of the calendar year (the tier time dimension).
• Therefore, the retention period for Tier 2 started on January 1, 2021.

3. Tier Upgrade to Tier 3

• On June 15, 2021, the member made an additional purchase of $1,500.
• With this purchase, the member’s cumulative spend for 2021 reached $1,500, qualifying them for an upgrade to Tier 3.
• This upgrade occurred within the current calendar year and was not under retention, as the member had newly entered Tier 3 within the ongoing evaluation period (2021).

4. Return and Tier Downgrade

• On July 14, 2021, the member returned a product worth $1,300.
• As a result, their net cumulative spend for 2021 dropped to $200.
• This spend no longer qualified the member for Tier 3 or Tier 2 based on the active years spend.
• However, rather than being downgraded to Tier 1, the member was downgraded only to Tier 2, as they were still within the retention period for Tier 2, which had started on January 1, 2021.

5. Retention Expiry and Final Downgrade

• On January 1, 2022, the Tier 2 retention period ended.
• The system re-evaluated the member’s total eligible spend for 2021, which remained at $200 after the return.
• Since the member had not met the $500 threshold for Tier 2, they were downgraded to Tier 1, effective from January 1, 2022.