Loyalty programmes usually don't deliver positive brand experiences

I have said before that fanatical loyalty should be a brands primary objective - but I am not a big fan of trying to do this via so called loyalty programmes.

Digital technology makes it easy to set them up but brand organisations should think very carefully before doing so.

Too many loyalty programmes are looking for quick sales but do nothing more than give regular purchasers discount cash-backs and coupons.

There is an interesting article from Colloquy about recent research that shows that only 17% of consumers say loyalty programs are a "very influential" factor in determining a purchase. They suggest that this is because loyalty programmes have fallen into a trap of copying one another with discount and cash-back rewards that increasingly look alike to consumers.

Brands that get it wrong waste resource, turn-off consumers and lose margin.

If a brand does decide to set-up a loyalty programme it should focus on demonstrating that the brand recognises and appreciates their consumers loyalty by adding value to the brand experience delivered.

The Colloquy articles suggest three tips:

1. Give consumers what they want - smart analysis of consumer data makes this possible.
2. Make consumers feel special – give them a sense of VIP insider status.
3. Keep it simple and be truly consumer-centric.

There may be more effective ways to deliver positive brand experiences that drive loyalty and potentially advocacy. 

Tread carefully.

What kills loyalty?

In a recent article Business Insider suggested 20 ways to kill loyalty. It admits to appearing negative but does provide a useful perspective - and check-list of what brand organisations have to avoid.


To me they the list is fairly obvious and a little repetitive, that said, the last point: 'a failed promise is a loyalty killer' is the deal breaker.


To be a successful brand you have to deliver the promises you are making (via brand communications). That is how you build loyalty, a key stage on the path to advocacy.


It is also important to remember that there are a number of different types of loyal customers [check-out Inertia, Transactional and Fanatical loyalists article], so for some consumers it is also important to find ways to delight them. 


That's how you build brand fans who are likely to advocate you and, as we all know, advocacy is the most powerful form of communication. 


Zappos know how to do this. They have a list of core values that everyone working there has to live and breathe. Top of the list is WOW through customer service.

Working out how to do delight/WOW isn't always obvious or easy but when you get it right, like Zappos, you will build a very successful business.