Why Most Loyalty Programmes Fail: One Secret to Success
Companies spend billions of Pounds in their efforts to improve their customer engagement and to encourage customer loyalty. That makes loyalty programmes one of the most significant business investments. Naturally, they expect this investment to reap sizeable returns too.
However, most of the loyalty programmes fail to produce those returns.
Clients want rewards, and their vendors are ready to offer it to them. In theory, all loyalty programmes should be a success, but they are not. Interestingly enough, most of the times, the reason is the same. Customers spend on the services under the knowledge that they can redeem their accumulated points at some point in the future. However, after waiting for the points to accumulate for months, they discover that they cannot spend them as they like. They are faced with numerous perplexing conditions.
Whenever loyalty programmes play a role in the clients’ decision-making process, they must deliver on the promises made. If they don’t, it can lead to a severely disappointing experience for the clients and produce a profoundly negative impact on the vendor’s brand image. This client’s trust is shattered. A 2017 global study by Capgemini found that “emotions such as honesty, integrity, and trust have the greatest influence on loyalty”.
There has to be an honest, value exchange between the business customer and the company. The lack of freedom to use the reward points slashes down that value. Limiting redeeming options hurts the loyalty programme. So, to see a better return from their loyalty programmes, B2B companies must implement a versatile loyalty programme like Prosper² Rewards. This open loop rewards programme does not coerce the enterprise clients into redeeming their rewards points with only a few limited vendors. Rather, the Mastercard-powered programme allows them to earn the points through a string of purchases and then spend the points like fiat currency courtesy of the multi-currency Prosper² Rewards Card.
This programme allows a perfect customer-programme fit. Each client can spend the points the way they like and at avenues that provide them utility. They are not bound by the decision of the company (running the reward programme) on how they can and cannot redeem their points. This essentially means that the clients can spend their rewards points like cash. This makes the clients understand that the programme is well-aligned with their purchase behaviour. This not only offers them a sense of freedom but also instils in them a perception of deep trust and reliability regarding the company. Why would they ever leave a programme that provides them with instant and recurring returns?
Clients will be able to see the value that the programme offers and appreciate its versatility.
They will want to come back and work with such a company. In a sticky B2B business, satisfaction directly translates to a long-term client. This is how companies can ensure that their loyalty programme delivers on what it promised the client and fetch the returns it promised the company. This is the secret sauce that makes any loyalty programme a success.