Loyalty Programs

Loyalty programs are directed by the retailers towards

the existing customers by building and maintaining

positive relationship with them. It is a promotional

strategy that has evolved recently. In this marketing

strategy you are targeting the existing customers by just

looking after them and pampering them.


Loyalty programs work on the premise of offering rewards

to people who continue being their customers and buying

from you. Airlines have successfully run their frequent

flying programs for years and have been able to have a

steady flow of customers. Similarly many retailers also

started programs like a frequent buyer cards, wherein the

frequent customers were given free gifts and at times

additional discounts also. This loyalty program can also

be referred to as customer recognition program.


However you should not underestimate the workload

that one to one relationship marketing presents

especially as the program grows in size. The larger

your company, the more customers you attract and the

more rewards you need to give over the life of the

loyalty program. This is not necessarily a bad thing but

can take an enormous amount of resources so you

need to prepared for it to grow and grow quickly. Also,

you should consider having several levels of your

loyalty programs, so that the customers who spend

more, earn more rewards. There again, this is tricky to

implement, so it helps to have a marketing agency

and reliable technology and administration teams that

can handle the logistics for you.


The loyalty programs can help you increase your profits,

because in these programs your good customers who give

you repeat orders of a certain amount only get the

rewards and benefits. While running these loyalty

programs, the other discounts are not given, especially

to non- members. Also no funds or resources are wasted on

other advertising or promotion material. On the whole

less money is wasted and your profits increase when you

run a loyalty program.


It is always good business sense to nurture and maintain

your existing customers. Therefore spending some amount

on this program will be a very sensible thing to do

because one it is easier to nurture the existing

customers than trying to find new customers. And two the

existing customers are the ones who give referrals. So

you have to take care of your existing customers for the

health of your business.


Scott F. Geld serves as the V.P of Marketing for

Marketing Blaster

Feel free to contact him with any feedback or

questions about this article:



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