The customer is the King! These words are taken seriously in the world of marketing. Customers are the means of trade for any firm. They provide services, but those services are of no use if the customers are not ready to buy or be served. Loyalty cards or schemes are one such way to keep the clients happy and give them a chance to enjoy the latest services and products. Hotels and restaurants also pull out such schemes for their loyal customers and so the best loyalty program availed by every regular customer.
A loyalty program is a step forward in grasping and encouraging the confidence of the customers that inculcates the loyal buying behaviour in them. This, in turn, becomes profitable to both the firm as well as the customers in many ways.
Loyalty programs are exhibited in the form of card and points. A loyalty card can have various forms like reward card, club card, green card, sales card, and advantage card. The names may vary, but the system remains the same. These plastic cards are just like your debit or credit cards. When you purchase from a particular restaurant or a hotel firm you get certain points, which are added onto these cards. Next time when you use the card these points can be converted into discounts.
It is seen that shoppers often change their spending behaviour depending on the reward and if they feel that the reward will be of value to them. So a points program where a huge number of points are needed to redeem a reward that is insignificant only devalues the whole program. Therefore, it is crucial that while designing a loyalty program, care must be taken to make it worthwhile for the customer. What this means is that the value of the reward should never be higher than its cost.
Companies will go on exploring loyalty programs and find ways to differentiate themselves from their competitors. Even though the strategies discussed above are inter-related, its success depends on designing such programs that are unique in itself and stands out from its competitors, segments customers to identify them individually and finally, and most important, in establishing new and broader contact with customers.