“We did everything right….but the impact of our loyalty programs has been a disappointment”. We hear that all the time from companies (and we’ve said it ourselves). Often those same companies are surprised when we ask them to focus first on the fulfillment part of their loyalty programs to look for problem areas.
It’s a common situation: a significant misalignment of the marketing of a loyalty program versus the fulfillment part of the same program. Companies do a better job of promoting their incentive and loyalty programs -- but many times the delivery part lags severely.
Why is this so important?
ROI of loyalty programs depends heavily on the customer both receiving and understanding the value of the rewards you offer them. It’s not something you want to leave to chance -- particularly when the stakes a high.
Where are the points of breakdown?
- Poor communication at the delivery end
- Complicated rewards structures or terms and conditions
- Language gaps (in some cases)
The important distinction is between:
- What a reward program claims to offer in exchange for customer behavior…
- The actual experience of customers with those rewards when they go to claim / redeem them
The latter is where the ‘rubber meets the road’ and determines the ultimate effectiveness of your loyalty (rewards) programs.