Understanding Loyalty

Loyalty aspectsCustomer loyalty is something that every business wants to attain. For many firms, the way to meet this objective is through a loyalty programme.

But before creating a loyalty programme, you have to ask yourself some key questions.

What are the goals for the business?
What results would you like to see?
And: will a loyalty programme achieve those objectives?

Before moving to a loyalty scheme, you have to be sure that the answer is ‘yes’ to that last one.

A loyalty programme is not simply a mechanism for providing discounts. Too many marketers seem to believe that loyalty schemes are there to make customers feel good about using their brand’s plastic cards, picking up points and getting special offers. If giving out discounts is all that you want to do, there are plenty of simpler and cheaper ways to do this – but they won’t provide the advantages that a carefully planned and executed loyalty scheme will.

If you want to:

  • Build customer relationships more effectively
  • Foster loyalty
  • Develop up-sell and cross-sell opportunities
  • Move consumers from low to high margin purchases

A comprehensive loyalty programme can help you achieve those goals.

A fully-developed loyalty scheme provides a foundation for effective database marketing that enables a detailed understanding of your customers’ behaviour – including preferences and spending habits – and tailored, targeted and individualised communications that respond to that behaviour, thus driving customer retention while improving profitability.