The Right Way to Reward Your Customers

Guest post by John Carvalho In today’s fragmented marketplace, true brand loyalty seems like a hard thing for companies to acquire and harder still for companies to hang onto. Yet, it’s arguably ever more important. Loyalty programs are a key tool for doing so. From a psychological standpoint, allowing consumers to earn and use perks [...]

Continue Reading...

The Fatal Flaw in Loyalty Programs (And How to Minimize Damage)

Loyalty and rewards programs can be great motivators. When a business rewards the behavior they want from their customers – say, giving them a free coffee after they consume nine – they encourage that behavior. The most potent loyalty programs go beyond mere periodic freebies and confer status.

Continue Reading...

Starbucks Loyalty Fail

Starbucks knows a thing or two about loyalty. I’m a Gold Card member, and enjoy the free refills as well as the periodic free drinks I accrue by using it. (Green Card members get the refill benefit, but not the free beverage after every 15 purchases. In addition, Gold Card members get a personalized card [...]

Continue Reading...

When Loyalty Points Beat Price Differences

Every merchant seems to have a loyalty program these days. It makes sense to reward customers for their patronage and encourage even greater frequency. But, it appears there’s one kind of loyalty reward that may be more effective. One study showed that “irrelevant information” (in this case, largely valueless loyalty points) changed consumer buying decisions.

Continue Reading...

Loyalty Programs: Of Rats and Men

It seems like everyone has a loyalty program these days. Buy a cup of coffee, and you get a punch card that promises a free cup after you purchase some number of additional cups. Shop at the grocery store, and you get points to reduce the price of gas. Our wallets bulge with partially punched [...]

Continue Reading...