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.
