Loyalty Programs Exist at Multiple Quality Levels
Some loyalty programs are strongly conceived -- driven by a set of business requirements and aligned to broader business goals. Others are defensive / reactionary -- created based on a follow the leader or external pressure basis. Both types keep changing … but for very different reasons.
Strong programs change to keep aligned with evolving business strategies
The stronger programs are focused (with specific target customer segments and buying behaviors which are rewarded). As was the case with Canadian airline Westjet, which recently made a significant change to its loyalty program, well conceived loyalty programs are changed as a result of a shift of core business strategy.
In Westjet's case, the airline was finding its focus on business travelers was excessive -- rendering its offering less attractive to bargain hunting casual travelers. Load factor remains a key metric for airlines (especially publicly traded ones) and Westjet management decided to focus on keeping its planes more full. That forced the airline to widen its loyalty program to all travelers not just bigger spenders as was earlier the case. One could say this change was positive in the sense that it was rooted in the program being tightly aligned to the business strategy.
The Weakest Loyalty Programs Also Change Often
It's truly amazing how many companies launch and operate loyalty programs with no specific customer segment or ideal buying behavior in mind. You'll find those programs changing often because their success is limited -- and their is no solid reason for companies to stay the course
With no alignment to key business goals, programs which are less than successful are aimlessly tweaked in a random attempt to create business impact.
The ideal loyalty program is dynamic
A well constructed loyalty program speaks for itself when the question of strategy comes up. The target audience is obvious and the ideal buying behavior even more so. And when that program undergoes changes, it's as much driven by a shift in core management thinking as it is by whim or lack of success.