Technique 8.9 Rationales of Loyalty Programs

To help determine if you have the right rationale for a loyalty program, respond the following statements with a "yes" or "no"

1. Customers make regular high-value purchases and you want to retain their patronage

Yes No

2. Customers are in a specific age group and you desire to retain their loyalty for life

Yes No

3. There is an opportunity to add value to basic support services

Yes No

4. Members pay a single annual fee for a service and you wish to retain their membership

Yes No

5. There is an opportunity to make regular offers and sell related products/services to a special interest group of customers

Yes No

6. There is an opportunity to differentiate a product/service by offering customers added value services that enhance the basic product/service

Yes No

7. There is an opportunity to offer the regular subscribers special benefits

Yes No

The greater the number of "yes" answers, the more reasons to start or continue a loyalty program. Obviously, the reaction to the conditions of the program will help determine its success or otherwise.

Remember: the cost of winning new customers is considerably higher than servicing existing ones.

 

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