Chief Investment Officer
Commercial Loan Automation
BirdsEye Viewrewards and loyalty programs
The industry is abuzz with talk about abolishing, changing or freezing rewards programs. Dodd-Frank and Durbin both through huge monkey wrenches into the economics of the programs, and the new economics remain uncertain. In fact, from 2009 to 2011 growth in loyalty program memberships among the financial sector rose a negligible 1.6% according to the COLLOQUY Loyalty Census, Compared with 77% from 2007 to 2009. It’s time to get back to the basics: purpose, value proposition, economics and effectiveness.
First, let’s define the destination: Customer Loyalty is a destination created through data-based marketing communications and product packaging that leads to sustainable and measurable change in customer behavior. If we don’t get such change the program isn’t working. So, measurement is essential and non-negotiable.
Also note that not all customers are looking for “hard” (discounts, giveaways etc.) benefits from the loyalty program. Many prefer “soft” benefits (trips, wine tastings). Offering both across all our distribution channels will maximize the value of your program, instead of using money as the sole attraction and benefit.