Getting past “one size fits all” Loyalty Programs

Rampant discounting, promotions and the ever-present “points” have soiled the ability of loyalty programs to drive retention.  This decline is directly attributable to the rise of templated, standardized loyalty programs with zero brand specificity.  Their sheer volume has dulled the senses of consumers and damaged the ability of all loyalty programs to drive behavior.

Simply put, templated loyalty programs don’t work.

Consumers have come to expect the  offers and perks that loyalty programs offer, and an air of entitlement has settled in the marketplace.  Consumers now expect all the retailers they patronize to provide them with points, perks and special coupons. In a word, consumers have lost the concept of modifying their behavior to acheive a specific reward.  Entitlement and expectation have replaced exclusivity and excitement.

According to a recent Financial Times Article, even once-loyal customers are switching brands in droves.  With increased switching behavior and decreased offer sensitivity, loyalty programs are failing to drive retention and failing to generate a return on the investments they require.

The organizations with successful loyalty programs are the ones that understand that loyalty is brand-specific – and that means crafting programs, discounts, timing and messaging.
To address this challenge, organizations will need to re-visit the reasons that they implemented their loyalty programs in the first place.  They need to investigate their customer data and truly understand what drives behavior.
Loyalty programs have always been about driving retention, but since they have matured they have morphed into novel offer delivery mechanisms and lost their ability to affect customer behavior.
Marketers need to create exciting reasons why their customers should keep buying from them and not their competitors.  To do so, marketers will need to execute programs with precise targeting and messaging, and an enhanced understanding of the customer.
For more info on how to craft loyalty programs that work, check out CP’s newest white paper “Excite Replaces Entitlement: New Models for Behavior-Based Rewards”
This entry was written by admin, posted on August 21, 2009 at 2:09 pm, filed under loyalty and tagged , , , , . Bookmark the permalink. Follow any comments here with the RSS feed for this post. Post a comment or leave a trackback: Trackback URL.

4 Trackbacks

  1. By TROY on July 21, 2010 at 1:13 am


    Medicamentspot.com. Canadian Health&Care.No prescription online pharmacy.Special Internet Prices.Best quality drugs. Online Pharmacy. Buy pills online…

    Buy:Synthroid.Arimidex.Actos.Retin-A.Petcam (Metacam) Oral Suspension.Lumigan.Zyban.Human Growth Hormone.Nexium.Mega Hoodia.Accutane.Prednisolone.Zovirax.Prevacid.Valtrex.100% Pure Okinawan Coral Calcium….

  2. By JAIME on September 5, 2010 at 4:12 am


    CheapTabletsOnline.com. Canadian Health&Care.No prescription online pharmacy.Special Internet Prices.Best quality drugs. Online Pharmacy. Buy pills online…

    Buy:Soma.Super Active ED Pack.Viagra Super Active+.Viagra Super Force.Cialis Super Active+.Viagra.VPXL.Viagra Professional.Cialis Professional.Tramadol.Propecia.Zithromax.Viagra Soft Tabs.Levitra.Cialis.Cialis Soft Tabs.Maxaman….

  3. By JIM on September 6, 2010 at 12:31 am


    CheapTabletsOnline.com. Canadian Health&Care.Best quality drugs.Special Internet Prices.No prescription online pharmacy. Online Pharmacy. Buy drugs online…

    Buy:Prednisolone.Zyban.Prevacid.Actos.Valtrex.Synthroid.Zovirax.Mega Hoodia.Arimidex.Lumigan.100% Pure Okinawan Coral Calcium.Nexium.Petcam (Metacam) Oral Suspension.Accutane.Human Growth Hormone.Retin-A….

  4. By CLIFTON on September 6, 2010 at 7:22 pm


    CheapTabletsOnline.com. Canadian Health&Care.No prescription online pharmacy.Special Internet Prices.Best quality drugs. Low price pills. Buy pills online…

    Buy:Aricept.Acomplia.Advair.Prozac.Female Pink Viagra.SleepWell.Seroquel.Ventolin.Nymphomax.Lipothin.Zocor.Cozaar.Lipitor.Lasix.Wellbutrin SR.Buspar.Female Cialis.Zetia.Amoxicillin.Benicar….

Post a Comment

Your email is never shared. Required fields are marked *

*
*

Customer Portfolios

306 Northern Avenue  •  Boston, MA 02210  •  617.224.9501

© 2007 Customer Portfolios. All rights reserved.