Do traditional loyalty programs really need a facelift to stay relevant in an environment where new technologies are made obsolete in the blink of an eye? Agreed! Loyalty program did wonders for many brands and heralded a new culture of engagement with customers at a level previously unheard of. The runaway success of loyalty programs prompted more brands to join the bandwagon hoping that profitability and visibility increase exponentially with little investment. Yet, not everyone made it big. The panacea for every customer – brand standoff is staring at a bleak future. Probably, loyalty programs failed to evolve as fast as the market itself.
Where has it gone wrong for the falling heroes? Marketing experts point to one of the salient features of brand loyalty – dissemination of information. Loyalty programs are designed for unidirectional flow of information. Information flows from the brands to the customers, not vice versa. Persuasion takes over the mantle from retention, for which the loyalty programs were originally made. Such blatant acts of persuasion not only turn away the customers but also cause irreparable damage to the recall value of the brand. Remember, nobody likes a bullying friend.
It’s high time loyalty programs undergo an overhaul. Times of persuasive advertisements and e-mailers are gone. The market asks for a reciprocal relationship where customer is as important as the brand in the decision making. Modern marketers can’t afford to feign ignorance to writing on the wall. Reverse Loyalty, a term coined by disruptive marketers, has become an inevitable feature of new age loyalty programs. The culture of taking the customers for granted is replaced by a symbiotic relationship of trust and mutual respect. Only such a relationship could stand the test of time.
Lap up the change before it eats you up!