Adding loyalty programs to the repertoire

(but not as a solo act!)

Many businesses have experimented with loyalty cards and programs as a

way of increasing customer loyalty. A loyalty card or program keeps track of

the purchases that a customer has made with your business. These programs

differ somewhat, depending on the business that offers them. Most of the

time, however, these programs offer on-the-spot discounts on selected items.

The business also may offer the customer with the loyalty card a lesser price

than the customer who doesn’t have a loyalty card.

Here are a few of the pros of loyalty programs:

 ✓ They keep your name in front of the customer.

 ✓ They encourage increased sales and return business.

 ✓ They can provide you with valuable customer demographic information

if you collect the data on purchases.

 But, of course, there are cons as well. Here they are:

 ✓ Unless the reward is significant, your program may not stand out among

other programs.

 ✓ Unique offers can backfire. For example, some business owners may

avoid punch cards and club cards altogether and instead opt for spe-

cial sales and offers for their most loyal customers. This can be a great

approach, but there’s always the unfortunate risk of offending custom-

ers if your special sale or offer doesn’t apply to them.

 ✓ Loyalty cards and programs can seem invasive to some customers,

especially if you’re tracking purchasing habits.

 ✓ Loyalty programs create a loyalty that’s based on your financial com-

mitment to the consumer. This type of loyalty lasts for a very brief time

when compared to consumer loyalty that’s based on your product.

Product-based loyalty is a much deeper commitment on the consumer’s

behal

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