Loyalty Programs and the Customer Experience.

How many loyalty cards do you have? I've got five I can think of straight away, plus I'm eligible for discounts through my auto club and other subscriptions I have. Even my credit cards give me bonuses I'm never likely to use.

Loyalty Leaders state 96% of people are members of at least one loyalty scheme, while 64% belong to three or more. How much do they change buying behaviour?

Loyalty schemes have two broad aims, to encourage return custom and to accrue knowledge on customer behaviour. Both these objectives have one real purpose, they allow a business to improve customer service. Good customer service is the single most important reason why people to spend more money.

Participation in loyalty clubs is high and rising, but does that translate to increased sales?

The answer from my experience, is that they can, if used as a tool and not a solution.

Good customer service has a number of aspects that need to be reinforced upon every contact. Some of those include:

Brand Expectation - The experience must be appropriate to the values the customer has been told to expect. It goes to the heart of how the customer relationship is evolving over time. This may include choice of language, manners or even discounts.

Interested - The customer must be able to articulate what they want and why they want it. This may require some questioning and coaching before the customer is clear about what will make them happy.

Problem Solver - The customer should be offered a solution to their current problems.

Relationship - The customer should be offered a solution to problems that will arise as they pursue their ultimate goals.

So, do all the loyalty schemes you are a member of assist in these four key issues? If not, then you probably just use them as a bonus on purchases you would have made anyway. Discounts, coupons and free offers can attract activity, but without a deeper experience, they are unlikely to inspire loyalty.

Consider how your customers experience your business from all touch points, including online and face to face. How can you use a loyalty scheme as a tool to make every customer experience exceptional?