Does It Pay to be Loyal to Your Company?
Welcome to 2015. I know we are halfway done with the year, but today is a new day. We have come to a point in the war for consumer loyalty that a good product, fair price, and friendly service are no longer enough.
These days, everyone now has a loyalty program and most of them look the same. Most people I talk with would not even consider of having a card that does not offer cash back. What that means for credit card issuers is that cash back is now an expectation rather than a benefit. During the recession of recent years, two things have happened:
- Consumers became more frugal.
- Businesses found ways to offer more value to those consumers.
Value Is What They Desire
As the economy has begun it’s slow climb back up, those same consumers are still looking for more value … and customer loyalty has waned. We have all seen the 1% and 2% commercials for cash back cards. No one is wowed by these cards because they all seem the same and the value is expected.
To move the needle on these new modern frugal consumers you have to offer more. Does that mean offering more cash back? Sure it does, but that is not the only thing it means. Value is what they desire.
Make them feel like you hear them and are offering them what they want. Choices, choices, choices are what most consumers value most. Give them something they feel they are not going to get anywhere else.
No one I know would only shop at a store that only sells brown shoes. They may be really great brown shoes, but sometimes I like black shoes and my wife likes shoes of every color. It is the same with loyalty programs. Sometimes people just want something a little different from what they see everywhere else.
The answer to the question we asked in an earlier post, Does 1.5% Cash Back Really Matter?, is NO. In itself it does not, but as part of a much broader program it can push the program over the top and give it the value consumers are looking for. My next blog will go into more detail of what some of those other parts of the total program can look like.
DBG Loyalty is a leading innovator in loyalty and rewards marketing. DBG was founded in 2002 because the industry was looking for a trusted technology leader who could develop and establish consumer loyalty programs. DBG has customer relationships which span from the time of inception.
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