Pioneers in the area of reward programmes included aitlines that offered frequent flyers frequent flyer miles that could be used for flight upgrades and for free flights. Today miles can be exchanged for a wide variety of rewards from flights to beauty treatments, hotel accommodation, etc. At the core of these and similar reward programmes, such as rewards of bed nights offered by hotel chains, is the fat that the reward recipient was often not the party that paid for the goods and services. Companies paid for air flights, hotels and restaurant bills and employees gathered rewards. These programmes are successful and often secure loyalty at higher prices because of the attractiveness of the rewards.
Another early player in the rewards arena was the use of punch or sticker cards. Companies would punch cards each time a customer purchased something and after the card was full a reward was offered. Grocery stores might, for example, offer up market crockey or cutlery as a reward. These programmes definitely encouraged customers to return.
VIP Status Rewards
At higher tiers in a programme customers qualify for rewards such as free delivery. Amazon Prime started here with members being required to pay $99 to join. Currently rewards include live music streaming, movies, etc. Certainly the potential benefits are worth more than the $99.
Companies such as Groupon offer Buy one Get One Free Coupons (Affectionately called BOGOF Coupons). These programmes were/are designed to divert consumer spend to slow times or days and they encouraged customer traffic from areas that, were it not for the deep dicount, would not shop at the coupon seller. Branding is that of the coupon vendor ( Groupon, etc.). These programmes do generate customers but the jury is out on whether or not they generate loyalty and in many instances they do not generate a profit.
With the movement from cards to Apps the opportunity for interactive information sharing has resulted. Valued coupons often offer non-financial rewards. Customers too, have the opportunity to offer feedback / reviews and to share links with friends and colleagues. Links to information, where needed are immediate and so queries are resolved and converting browsers to buyers has meaning. Enabling live sharing enables and encourages customers to offer referrals and going the extra step of providing coupons/ rewards/benefits to customners to send to friends and colleagues tales customers to the next level of becoming active and loyal advocates of a business which is, in essence - loyalty marketing. Branding is retained and so brand loyanlty is nurtured.
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