Shopping for loyalty: an executive's wish list

2009 ◽  
Vol 26 (1) ◽  
pp. 49-51 ◽  
Author(s):  
Bruce Kerr
Keyword(s):  
Customer Loyalty ◽  
Customer Relationship ◽  
Loyalty Programs ◽  
Customer Engagement ◽  
Strategy Development ◽  
Loyalty Program ◽  
Content Type ◽  
The Future ◽  
Loyalty Program Design ◽  
Past Experiences

PurposeThe purpose of this paper is to present a blueprint for loyalty strategy development, and to inform the reader of the basic and not so basic elements that should be considered by companies, academics and executives when determining the future effectiveness and success of a customer loyalty program.Design/methodology/approachThe paper draws on author expertise and know‐how, as well as past experiences and market trends, to present a compelling review of necessary elements for a customer relationship program.FindingsBefore embarking on a loyalty program design companies should be wise to set long‐ and short‐term goals to drive the initial strategy. One should avoid launching a “me too” program by differentiating from one's close competitors. Implement a strategy from top to bottom across the organization. Data and customer engagement are the most important elements to foster.Practical implicationsA well‐planned and executed loyalty strategy can boost growth in incremental sales, increase in‐store traffic, drive higher impact from promotions and significantly boost overall revenues. Customer relationship marketing can also lead to richer data insights about current customers and high‐value potential customers.Originality/valueAn executive with decades of experience building and maintaining customer loyalty programs cites trends for the future of the loyalty discipline.

Innovating the customer loyalty program with social media

2019 ◽  
Vol 32 (5) ◽  
pp. 807-823 ◽  
Author(s):  
Wu He ◽  
Xin Tian ◽  
Feng-Kwei Wang
Keyword(s):  
Social Media ◽  
Customer Loyalty ◽  
Theory And Practice ◽  
Loyalty Programs ◽  
Loyalty Program ◽  
Data Set ◽  
Content Type ◽  
Media Technologies ◽  
Customer Loyalty Programs

Purpose Few academic studies specifically investigate how businesses can use social media to innovate customer loyalty programs. The purpose of this paper is to present an in-depth case study of the Shop Your Way (SYW) program, which is regarded as one of the most successful customer loyalty programs with social media. Design/methodology/approach This paper uses case study research as the methodology to uncover innovative features associated with the SYW customer loyalty program. The authors collected the data from SYW’s social media forums and tweets. The data set was analyzed using social media analytics tools including the R package and Lexicon. Findings Based on the research results, the authors summarize innovative social media features identified from SYW. The authors also provide insights and recommendations for businesses that are seeking to innovate their customer loyalty programs using social media technologies. Originality/value The results of this case study set a good example for businesses which want to innovate and improve their customer loyalty programs using social media technologies. This is the first in-depth case study on the SYW program, one of the most successful customer loyalty programs with social media. The results shed light on how social media can innovate customer loyalty programs in both theory and practice.

Exploring effects of hotel chain loyalty program

2014 ◽  
Vol 8 (4) ◽  
pp. 375-387 ◽  
Author(s):  
Pedro Pimpão ◽  
Antónia Correia ◽  
João Duque ◽  
José Carlos Zorrinho
Keyword(s):  
Customer Relationship ◽  
Loyalty Programs ◽  
Loyalty Program ◽  
Content Type ◽  
Purchase Frequency ◽  
Hotel Chains ◽  
Dirichlet Model ◽  
Hotel Chain ◽  
Practical Implications

Purpose – The main purpose of this work is to evaluate the long-term effectiveness of a hotel’s chain loyalty program from a behavioral perspective. Design/methodology/approach – A Dirichlet model was estimated to assess purchase frequency and hotel choice within one of the biggest hotel chains in Portugal. The sample comprises hotels where a loyalty program was implemented, with a total of 176,099 reservations. Data were extracted from the customer relationship management (CRM) systems of the hotel group. Findings – The results suggest that instead of being loyal to a certain hotel, customers are loyal to the branded hotel chain. As the hotels are all part of the branded group, this polygamy is not only accepted but also very welcome. Research limitations/implications – The level of penetration and purchase frequency of CRM was measured. Nevertheless, a thorough understanding of these will be critical for the success of this program. Practical implications – This research is a step toward assessing hotel chain competitiveness, by improving and suggesting segmented groups of brands/hotels and to induce cross-selling products accepting polygamous loyalty as the only way to sustain long-term relationships with customers. Originality/value – This is one of the few research studies, if not the only one, to assess loyalty with tangible indicators, such as purchase frequency. Further, the results suggest that loyalty programs are more effective if multiple options are available and as such, cross-selling is perhaps the only way to fix customers.

scholarly journals Why organizational loyalty programs cannot prevent switching

2020 ◽  
Vol 34 (2) ◽  
pp. 207-222 ◽  
Author(s):  
Frauke Mattison Thompson ◽  
Sven Tuzovic
Keyword(s):  
Cultural Values ◽  
Customer Loyalty ◽  
Affective Commitment ◽  
Program Effectiveness ◽  
Industrial Country ◽  
Loyalty Programs ◽  
Switching Behavior ◽  
Loyalty Program ◽  
Content Type ◽  
Individual Level

Purpose The purpose of this study is to investigate the extent to which loyalty programs can prevent switching, and how individual level cultural values impact this. Loyalty programs are designed to create switching costs, which reduce customers’ desire to leave. However, in practice, these programs are often misapplied; that is, most companies inadvertently treat all customers as equal. While ample research has examined the role of loyalty reward programs in facilitating customer loyalty, little is known about the extent to which individual-level cultural values moderate customer loyalty measures of trust and affective commitment and how this impacts the effectiveness of loyalty programs; that is, consumers’ intentions to “stick” with the program or to switch. Design/methodology/approach This study uses a quasi-experiment combined with an extensive survey to collect the data. Findings Based on data collected from one industrial country and four emerging countries, the results show that loyalty programs do not universally prevent switching behavior. Instead, this study finds that individual-level uncertainty avoidance and collectivist values significantly moderate the effects. Originality/value This study helps advance the understanding of how international retailers can increase their loyalty program effectiveness and reduce customer switching to competitors.

Customer retention at Hyundai Motor India Ltd

2013 ◽  
Vol 3 (3) ◽  
pp. 1-12
Author(s):  
Rik Paul ◽  
Debapratim Purkayastha
Keyword(s):  
Market Share ◽  
Customer Relationship Management ◽  
Automobile Industry ◽  
Relationship Management ◽  
Customer Retention ◽  
Customer Relationship ◽  
Loyalty Programs ◽  
Loyalty Program ◽  
Content Type ◽  
The Cost

Title – Customer retention at Hyundai Motor India Ltd. Subject area – Marketing management, services marketing, customer relationship management and strategic marketing management. Study level/applicability – This case can be taught effectively to MBA/MS students. Case overview – Hyundai Motor India Ltd (HMIL) commenced operations in India in 1996 and launched its first car in India – the Hyundai Santro – in 1998. Since then, there has been no looking back for the company. Its domestic and export sales figures have risen manifold each year and the car maker has gone on to become the second largest manufacturer in the Indian car market with a market share of 18.10 percent as of 2010-2011. By 2009-2010, most of the major international car makers were setting up production facilities in India. The market was set to become highly competitive and it became imperative for manufacturers like Maruti Suzuki India Ltd (MSIL) and HMIL to retain their customers in order to maintain their market share. Nalin Kapoor, General Manager (Sales & Marketing) was contemplating the marketing strategies he could use to counter the stiff competition. Customer retention was one of the major problems in the automobile industry as the purchase time span varied between three and five years and the cost of brand switching was nil. HMIL had been pursuing customer relationship management activities but its customer retention ratio was declining. Kapoor and his team decided to study the loyalty programs of some companies in the automobile industry to ascertain whether launching a loyalty card could solve their problem of retention. The marketing strategy department with the help of a management intern extensively studied the existing loyalty program of Hero Honda, MSIL, and Ford to identify how those programs were designed and promoted to the customer. The reports also indicated the shortcomings of each program and the features which were highly accepted by the customer. The loyalty program also had cost implications as there was a need for a strong technical support team to run it successfully. With the reports in hand, Kapoor was in a dilemma on whether launching a loyalty card would be feasible or not. If yes, then how should it be structured to motivate the customers to stay loyal to the company? Also, how could the cost in terms of promotion, training, and technical support be justified? If not a loyalty program, then what marketing strategies should the company pursue to retain customers effectively? The problem demanded immediate attention and action and Kapoor was well aware of the implications that a delay in decision making would have for the market share of the company in the growing and dynamic automobile industry in India. Expected learning outcomes – These include: the concept of customer relationship management; relationship marketing; customer retention; customer loyalty; customer profitability segments; relationship bonds; and designing loyalty programs. Supplementary materials – Teaching notes are available for educators only. Please contact your library to gain login details or email: [email protected] to request teaching notes.

scholarly journals CRM system and potential customer loyalty trends: Some evidence of customer engagement

2021 ◽  
Vol 8 (5) ◽  
pp. 44-52
Author(s):  
Algamdi et al. ◽  
Keyword(s):  
Customer Loyalty ◽  
Research Literature ◽  
Customer Segmentation ◽  
Customer Relationship ◽  
Loyalty Programs ◽  
Customer Engagement ◽  
Service Market ◽  
Building Relationships ◽  
Building Activities ◽  
The Relationship

This present paper aims to validate the relationship between loyalty programs and to recognize the value of implementing CRM systems by the dimensions of CRM realize and commercial banks. This article also presents an emerging CRM research literature as CRM's customer-focused component, investigating the relationship between CRM and customer loyalty. By implementing robust information management, CRM aims to improve customer interactions through a portfolio of trust-building activities. Simultaneously, most CRM literature focuses on banks designing and executing CRM initiatives. The current research explored various customer loyalty determinants but pay less attention to understanding the relationship between product dimensions and fundamental loyalty mechanisms. The study used both quantitative and qualitative data, focusing on Saudi banks' CRM dimensions and customer loyalty. The Data were collected using surveys and interviews. The finding of this study indicates that the basis of the relationship between the bank and customers is the element of credibility and security privacy and confidentiality of information. However, customer acquisition practiced more than preserving customers (contact, quality of service, market response). Building relationships with them, so the Bank services focused on the retention customers and building relationships with them in the short term, because it is a Less cost, and ameliorate part of customer segmentation actual and potential market of banks on the long term strategy. The study enriches the banking literature on how to implement customer relationship management (CRM) in financial institutions. This topic has not been discussed mainly in the Middle East except in a few studies. Despite the challenges facing banks in light of the spread of Fintech companies and their repercussions on banks operating in the region.

Exploring the impact of rewarded social media engagement in loyalty programs

2017 ◽  
Vol 28 (2) ◽  
pp. 305-328 ◽  
Author(s):  
Lena-Marie Rehnen ◽  
Silke Bartsch ◽  
Marina Kull ◽  
Anton Meyer
Keyword(s):  
Social Media ◽  
Laboratory Experiment ◽  
Field Study ◽  
Loyalty Programs ◽  
Customer Engagement ◽  
Loyalty Program ◽  
Content Type ◽  
Social Media Engagement ◽  
Loyalty Intentions ◽  
The Impact

Purpose New approaches in loyalty programs try to activate membership by rewarding not just financial transactions but also customer engagement. The purpose of this paper is to analyze the effect of rewarded customer engagement on loyalty intentions and behavior by applying a social media context. Design/methodology/approach A field study in the mobility service industry (focus groups (n=18) and questionnaire (n=1,246)) and a laboratory experiment (n=141, 2 (rewarded engagement and transaction/rewarded transaction)×2 (low/high reward) between subjects design) were conducted to determine the effect of rewarded engagement on loyalty. Findings In the field study, the participants could gather loyalty points through their social media engagement. Their attitudinal loyalty to the loyalty program and the company was significantly higher than that of the loyalty members who collected points solely through transactions. This effect is especially prevalent with respect to engagements rewarded with monetary incentives and is underlined by behavioral data. The results of the laboratory experiment show that rewarded engagement positively moderates the impact of intrinsic motivation on loyalty intentions. Offering rewarded engagement in loyalty programs offsets the undermining effect of rewards. Practical implications Rewarding customers for social media engagement can be a beneficial way of boosting active participation in loyalty programs, but this experience should be enjoyable and self-determined. Originality/value The study is the first to show the impact of rewarded customer engagement on the attitudinal and behavioral loyalty of members of a loyalty program.

Temporal Orientation and Customer Loyalty Programs

2021 ◽  
pp. 193896552110084
Author(s):  
Flavia Hendler ◽  
Kathryn A. LaTour ◽  
June Cotte
Keyword(s):  
Customer Relationship Management ◽  
Customer Loyalty ◽  
Customer Relationship ◽  
Loyalty Programs ◽  
Temporal Orientation ◽  
Loyalty Program ◽  
Hospitality Managers ◽  
Customer Loyalty Programs ◽  
Depth Interviews

Loyalty programs play a prominent role in many firms’ customer relationship management programs, but not all programs are successful. Providers need to understand not only what benefits customers want in a program, but also how they want to be treated as a loyalty member. We posit that because loyalty programs offer rewards that are time-bound (immediate or delayed), and that loyalty programs seek to develop a relationship that extends over time, an important, but overlooked dimension for hospitality managers to consider is how their customers view time. Our research focuses on customers’ temporal orientation—the tendency to think in the present, future, or past. We use depth interviews to explore existing casino loyalty program participants’ thoughts and feelings about their ideal loyalty program. We find the customers’ temporal orientation influences the type of relationship as well as the type of benefits sought in the loyalty program. Our research offers managerially practical insights for identifying customers more likely to engage in co-production of a long-term loyalty relationship as well as for creating communication strategies that are likely to interest and provoke different temporal mindsets.

Loyalty program in Africa: risk-seeking and risk-averse adventurers

2014 ◽  
Vol 69 (2) ◽  
pp. 137-157 ◽  
Author(s):  
Shogo Mlozi
Keyword(s):  
Consumer Behavior ◽  
Consumer Products ◽  
Loyalty Programs ◽  
Risk Averse ◽  
Loyalty Program ◽  
Content Type ◽  
Risk Seeking ◽  
Proposed Model ◽  
First Time ◽  
The Relationship

Purpose – This article aims to test the relationship between expected attractiveness-satisfaction-loyalty for international adventure tourists visiting Tanzania. The proposed model is based on travel consumer behavior theoretical constructs extracted from the literature. Design/methodology/approach – This article aims to test the relationship between expected attractiveness-satisfaction-loyalty for international adventure tourists visiting Tanzania. The proposed model is based on travel consumer behavior theoretical constructs extracted from the literature. Findings – The findings for overall model differed from the moderating factors of high risk, low risk, first-time visit and repeat visit. Also, the results are interesting when satisfaction is tested as a mediator. Practical implications – Practitioners could consider the fact that repeat visits may change tourists’ perceptions toward destination and may even increase their inclination to take on risks. This may impact innovation of consumer products in tourism. Also, policy makers could benefit on how loyalty programs can be developed to increase performance. Originality/value – The study offers specific strategic recommendations toward different groups of tourists (i.e. first-time, repeat visitors, risk averse, risk seeking) and proposes logic for setting up a loyalty program as a long-term strategy for success.

Increasing customer loyalty to the firm

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Keyword(s):  
Case Studies ◽  
Customer Loyalty ◽  
Design Methodology ◽  
Reading Time ◽  
Effective Communication ◽  
Cutting Edge ◽  
Loyalty Programs ◽  
Content Type ◽  
Pertinent Information ◽  
Practical Implications

Purpose This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies. Design/methodology/approach This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context. Findings Businesses have scope to increase customer loyalty to the firm through the introduction of loyalty programs. Relevance of such programs to target consumers is critical and their overall impact can be enhanced through the use of effective communication. Originality/value The briefing saves busy executives and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.

scholarly journals Loyalty programs: the vital safety feature for airlines to survive COVID-19

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Manuel E. Pascual ◽  
Lisa Nicole Cain
Keyword(s):  
Airline Industry ◽  
Loyalty Programs ◽  
Current Response ◽  
Long Term Effects ◽  
Loyalty Program ◽  
Case Study Methodology ◽  
Content Type ◽  
Hospitality And Tourism ◽  
American Airlines

PurposeThe airline industry has been severely impacted by COVID-19 due to widespread travel restrictions. Its current response is crucial to ensure continued operations after the global pandemic is resolved. One resource the airlines are leveraging is loyalty programs. This study aims to examine the viability of leveraging loyalty programs in times of crisis.Design/methodology/approachThis study employs a case study methodology to examine how one company, American Airlines, has used its loyalty program to survive a pandemic and alleviate the financial costs associated with limited and restricted travel.FindingsAmerican Airlines' AAdvantage loyalty program structure may be used as a benchmark to understand how airlines can anchor their loyalty base to reinvigorate travel interest and use these programs as safeguards in critical instances that may arise in the future.Research limitations/implicationsThe case was bound by the fact that the pandemic was still a threat during the time of analysis. The findings of this case study go beyond the airline industry and may inform other hospitality and tourism organizations on the benefits of loyalty programs in times of financial distress.Originality/valueThis is the first known case study examining the strengths and opportunities of the structure of the American Airlines' AAdvantage program as a means for surviving in a time of crisis. Moreover, understanding how to mitigate the long-term effects of crises may help to inform future short-term strategies of airlines and other hospitality and tourism organizations for navigating unexpected shocks to their ecosystem.

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