Marketing Advisor Update

Sales and marketing tips, insights and advice for service businesses amd companies selling complex or technical products.

Friday, December 15, 2006

Less than 25% of people think loyalty programs offer value

It is common practice these days for business owners to consider adding a loyalty/card scheme to try to attract and retain customers. But do they work? Are loyalty programs worth running?

In most cases I would say NO. And research says that less than one in four consumers felt that loyalty programs offered excellent value.

Conflicting information is all around us. Even in this article about providing good service at Christmas, it is suggested businesses should offer a loyalty program. Then it goes on to say how it is important to be different (which is a great challenge), and that less than 25% of people think it is good value anyway. So why should you even consider it?

My own previous investigations in this area have shown there is plenty of evidence that for service businesses, success relies on much more important factors than a loyalty program.

In fact if people trust you and get good results from your service, you don't need a loyalty program to reward them (which is usually just a discount scheme under another name). They will come back to you anyway.

Bottom line: Don't assume a "loyalty" program will make clients more loyal.


Post a Comment

<< Home