After certain phase, static customers must be transferred to special customers. Else, the customers might get into next option, where he would be treated special. When, the era itself is of ‘relationship marketing’; either the product has to be worth quality like Apple’s product, where the customers are always loyal – or they will have to adopt the relationship marketing strategy for sure. Customer loyalty program is something must, for maintaining long term relationship.
When the business is much more about profit, this relationship is much more about creating an impression that the customers are being treated special. Be it through hard benefits, where the benefits are created and distributed within the organization itself through discounts, rebates, coupons or through soft benefits where third party, or agents are being used for further benefits through magazines subscription offers, travel coupon discounts, free tickets to concerts. Only when customers perceive that they are the part of that particular shop or organization, they start gaining the sense of belongings – and continue up the relationship ensuring ‘loyalty’.
In order to sustain in the competitive market, marketers have been effectively implementing ‘Customer Loyalty Programs’ through the best approach possible. Amazon has been providing free access to their streaming service, free two way delivery – which can be sometimes delivery within an hour to prime members. While some have been rewarding points to their customers, where they might get 1 point for an item purchased, and 5 points if referred to friend. Once the customers make it 10 points, they could then redeem to cash and purchase something out of it as well.Or, Costa Coffee, where the customer can enjoy tenth coffee for free from any outlet throughout UAE.
Getting narrow to India, they have wonderful customer retention schemes, where the customers will be compelled not to switch the option. Be it in Reliance Mart of India, where they have point system which could be redeemed at any time, or in Ola Cab, where free rides are provided; simply to ensure customer loyalty- there have been different packages for loyal customer. The way Jio entered market providing fee data and other service to increase customers and to ensure customer loyalty is wonderful example.
There is nothing like “Eighty points would equal to 500, which would be 40% off in next purchase” in South Asia to start with. Remembering the initial such programs, there used to be time when 10 empty packets of noodles were submitted to the store, they would provide one packet of noodles. Similar used to be the case of soft drinks decades back. However, at this time; there are any impressive packages or offers that are done by South Asian organizations to retain their customer. Customer loyalty should give the benefit of doubt.
E-sewa has it’s reward system, through which someone could even obtain motor cycle. However, that is like reaching a moon for anyone in Nepal. Similar is the case with Reliance Mart in India. While at other times, they themselves get confused – if it is sales promotion scheme or real customer loyalty program. Customers will not even know when local vehicle came up with free one way ticket when they gather ten tickets, and won’t even know when the offer ended.
However, there have been attempts to encourage repetition be it by restaurant or airline companies. While restaurant offer wifi password and discounts to regular customers, airlines companies have been working to maintain the loyalty level at some times, because they not only provide free ticket upon certain ride but also ensure special treatment to loyal customers during peak time.
It is important for business houses to understand that loyalty programs can’t be run simply by marketing, but with emotions too. Concentrating too much with the loyalty objectives and activities will end up no where. I have been rejecting the loyalty program on my own, because I know I won’t buy more than their quoted price in the month. Survey done by Maritz Loyalty Marketing clearly indicated that the majority of consumers abandon loyalty rewards programs because they grow tired of waiting for the points to accumulate. Our marketers should not be confused about “loyalty” and “retention”; because they may get out of their attraction once they satisfy their interest level. Retention is something that marketers should be highly concerned about. Why should someone always be loyal towards Café Coffee Day, if he has other wonderful option nearby?
South Asian market is much more trial market, where the customers opt for trying the option. If any third noodle company enters, this market will certainly try for those new noodles to experience it. But, retention is something to worry about in the end.
Published in The State Times of Jammu and Kashmir, August 7, 2018
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