Dave’s been going to his local pub The Abandoned Cart for 25 years.

Wednesday to Saturday, like clockwork.

The Cart’s hosted Dave’s daughter’s wedding, his mother’s wake and probably half of his monthly pay packet over the years. 

Everyone knows his order, his seat, even his preferred brand of peanuts. Dave is The Cart, and The Cart is Dave. 

One evening however, there’s someone new behind the bar. The routine slips. The wrong drink, the wrong seat, no peanuts. It’s nothing dramatic – Dave’s far too British for a fuss – but something changed. 

The next week, just for a bit of variety, Dave decides that he might just try The Conversion Arms round the corner. Of course, he still pops back to The Cart now and then, but the spell’s broken. 

Dave is (or was) what we call a VIP customer. 

Who are VIP customers?

Very important customers don’t just spend a bit more, they spend a lot more. They are the golden 1 to 10% who generate between 20 to 50% of a brand’s total revenue, according to McKinsey). 

VIPs are your big spenders. 

However, there’s one thing we shouldn’t confuse VIPs with, and that’s loyalty. 

These customers are savvy, they know their worth and in lieu of their high spending habits expect to be recognised, treated differently and given a reason to stay. 

And if, like Dave, they experience slips, they won’t hang around. Half of VIP customers are willing to switch brands every single year if they don’t feel properly looked after. However, with a solid VIP programme, brands can be expected to reduce churn by 5 to 10%, according to McKinsey’s research 

VIP expectations 

Imagine the High Net Worth Individuals (HNWI) who enter Harrods (probably via their own exclusive entrance). They expect discretion, the highest level of service and exclusive – and we really do mean exclusive – perks. They aren’t interested in a sliding scale of bonus points and incentive-derived discounts. They are off the scale. 

Although your brand might not be catering to HNWI, the point is, the way you look after your VIPs should be very different to your loyalty programme. 

Granted, for mainstream brands the VIP experience probably looks very different to the Harrods of this world – but – it should be no less focused on the individual. 

When you’re a VIP customer it should be personal; one to one calls to get their feedback or a surprise survey which leads to something special. You could give them very first and exclusive access to a new product drop, let them peek behind the scenes with a personal tour around a workshop or production line. Or offer them something nobody else can get, such as special editions and limited runs. 

The brands out in the wild who are already nailing this include:

  • Sneak’s elite programme lets top customers rack up points for exclusive rewards. Sneak invites their VIPs to flavour development sessions where fans get a say in what hits the shelves next. 
  • Boots’ Advantage Card secret sampling program slips surprise products into the hands of their most engaged shoppers before anyone else sees them. 
  • Uber’s secret VIP tier gives theirs access to better cars and better drivers for the same price as an UberBlack. 

How using VIPs can help you as a brand

As well as being a great source of income, VIPs are also a great source of insight. 

If anyone knows what makes your brand tick, it’s the people who’ve spent the most time (and money) with you. They can tell you things your CRM can’t:

  • Why do they keep coming back?
  • What almost made them leave?
  • Where could you do better?

As they sit at the sharp end of your revenue, these insights are highly focused and commercially loaded – and at your disposal. So use them.

Plus, from a psychological perspective, when you ask for someone’s opinion, you give them a chance to express themselves. People naturally warm to those who listen and show genuine interest in their views.

How to identify your VIP customers

So what’s the definition of a VIP and how do you set the threshold to become one? Well that’s entirely dependent on your brand and what you sell. A skincare brand’s VIP might be someone spending £500 a year; for a high-end bike brand, that’s barely going to cover the tyres.

This is where your CRM can help: 

  • How much someone’s spent over time (LTV)
  • How often they come back (purchase frequency)
  • How long they’ve stuck around (subscription length, for instance)

But a word of warming – be careful with thresholds. If you set the VIP bar low, you’ll flood your programme with too many people. This will water down the experience and make it impossible to offer anything genuinely special. 

And, just because you’ve read this blog, it doesn’t mean you have to create a VIP programme if it’s not right for your brand. Don’t try and reverse engineer something just because you think you should (or because Space & Time said so). 

What are VIP programme goals?

Before you start handing out perks, you need to be clear on why you’re building a VIP programme in the first place. Is it about keeping your best customers happy? Or are you trying to get them to spend even more?

Retention and growth aren’t the same and therefore require different approaches:

If your focus is retention, your rewards should make your VIPs feel recognised, appreciated and part of something special. Think early access, exclusive experiences, personal touches. It should be about building an emotional connection. 

If your focus is growth you might lean harder on spend-based incentives such as tiered rewards, exclusive product bundles, referral perks or limited-time upsell offers which encourage them to add a little more to their basket.

Transparency vs. exclusivity 

One of the biggest strategic choices is deciding how loud you want to be about your VIP programme. Do you shout about it? Or keep it hush hush?

You could dangle VIP status like a carrot and show customers exactly what’s waiting for them if they spend a little more. It needs to be visible, attractive and aspirational. This approach works best if you’re building an inclusive brand with wide appeal.

On the other hand, you may want to keep your VIP programmes under wraps – cloaked in secrecy, invite only and very quietly impressive. Your goal is not to motivate but to make the few who are invited feel genuinely special. This approach is best suited to luxury, high-end brands where secrecy adds to the allure. 

Both approaches work but for different reasons, so pick your fighter. 

Your VIP customers are just like Dave. You need to know their order is a Guinness top, you need to listen to what they want. You need to create the kind of experiences which make them feel seen, valued and happy to keep spending. 

This blog is part of our series Beyond Bargains where we look at ways to add value to your customers without constantly discounting. 

If you want to keep your Daves firmly on their barstools – and spending – let’s talk.