Creating lasting Loyalty Programs

With the myriad amount of loyalty programs out there, marketers are facing problems generating and retaining members. There are now more loyalty programs spanning numerous industries then ever before. Many shoppers are signed up for numerous programs, and out of 18 programs, most will only participate in 8 (Colloquy). There is concern that because of this, shoppers are focusing on how to game the system instead of being actual loyal customers. This problem is opening up marketer’s eyes to re-accessing the quality of their programs. FastCompany.com has put together a list of some strategies marketers can apply to keep their loyalty program fresh and enticing.

1) Play Favorites – You want to be THE loyalty program people choose. In that quote of 18 programs, you want to be their number 1 most used. In order to do this, you have to use metrics and some investigating to offer rewards correlating to what your customers like to do. For example, if your customer likes to do outdoorsy things, perhaps offer rewards related to camping stores, equipment, and travel. If your customer flies frequently, obviously you want want to gear your program towards flight mileage.

2) Avoid Stark Policies – This one is easy, don’t make your customers turn against you by doing things quickly without them knowing. For example, do not take away their points through expiration or devalue their points. Instead, help your customers get the best out of their program.

3) Partner up – Very straightforward, find partners with your loyalty program to ensure rapid visibility and flexibility. People are more likely to use a program that pairs gas and flight mileage over just gas.

4) Don’t make ties impossible – No one wants to join a program that has multiple loyalty tiers only to find out they can’t get out of the bottom level. Make the goals for climbing up the tier ladder clear-cut, attainable, and well explained.

5) Keep in contact – Make it easy for your customer to track and analyze their program points, and keep in contact. The more you interact with them the more they will be interested in using your program.

Through these strategies your loyalty program should be able to set itself above the rest and most likely keep more customers.

5 thoughts on “Creating lasting Loyalty Programs

  1. When I worked for Tops Food Market we had a loyalty program that would reduce that cost of gas per gallon. The program was extremely successful, because all of the customers valued saving money. The program made it very easy to track their points and they were easy to redeem. During this program, Tops Food Market sales had increased.

  2. I love the topic of loyalty programs because I find myself utilizing their benefits and advantages frequently. As the world (in general) becomes more frugal with their purchases, loyalty programs are (and should be) becoming more relevant and prevalent. I really liked the tips the article gave regarding loyalty programs especially the idea of partnering up. As a consumer, I don’t see too much of organizations partnering up for the greater good of the customer and would like to see more! I also liked how the article touched on making it somewhat easy to pass through levels; it can get really annoying not being able to see the value of your loyalty program!

  3. Great article! working in retail for many years I can tell what customers actually value the brand they are buying from those who are just in it for the quick discount. Best buy had a great way for customers to earn actual in store dollars on every purchase they made, but the enrollment process was to confusing and time consuming. Recently they revamped it and it works great! Gamestop does a great job of keeping true to the 5 rules by not only rewarding customers for purchasing with them but also trading in games and keeping up with news about the company.

  4. This is a really great topic, I have found that loyalty cards work about half of the time and it’s nice to know that there is information on how to increase the efficiency and usage of these sorts of services. My parents used to own a restaurant where they used punch cards for bubble tea purchases and it worked well but would have been better with these tips, especially the partnering with other companies and allowing individuals to track their points. As an individual I think these few tips if done correctly would entice me to use my loyalty card as well.

    I do wonder if loyalty cards are becoming less popular or if maybe mobile loyalty cards is where the future is headed (if at all possible).

  5. I really like the idea of partnering up with other businesses for a loyalty program. Not only will it create more press and therefore more visibility for your business, it will also offer the consumer more benefits and a chance to interact with multiple brands at the same time.

    Businesses should be very careful to partner with anyone. The partnership should make sense. It would also be good to update the original loyalty program when the partnership is made. This is a great opportunity to totally re-haul the program if it was struggling in the past. If they program is already strong, partnering is a great opportunity for visibility and reaching new consumers with the programs benefits.

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