Loyalty Programs in Indian Retail

2889 WordsFeb 28, 200812 Pages
Retail Loyalty Programs Loyalty Programs in retail : An overview What is a loyalty program ? Loyalty programs are the schemes designed with an intention to retain existing customers and attract new customers by rewarding a customer with both hard and soft benefits for his loyalty and patronage. Classification Loyalty programs (either ‘on the shop delivery ' or ‘web based ') can be classified either based on types of rewards and recognition tools used or the mechanism by which customers earn their rewards. Classification based on the mechanism by which customers earn their rewards : 1. Earning points towards a reward of free or discounted product. Such kind of approach is normally used in applications where there is high transaction…show more content…
Page 7 of 21 CASPIAN and No-cards shoppers are some of the numerous anti-loyalty programs consumer groups active across the globe Benefits of Loyalty programs: >Retention >Up gradation of shoppers >Valuable data >Increased sales >Increased footfalls >Brand reinforcement IIFT_NCS - Paper writing contest Essentials of a successful loyalty program Before discussing essential elements of a successful loyalty program, it is critical to understand that there are a lot of strategic issues that a company should consider before deciding whether it should go ahead with a loyalty program or not .Also, there should be a proper alignment between an organization 's strategy, its business model and customer 's needs and preferences. Now let us look at what successful loyalty programs all over the world have in common: Realistic and focused program objectives A well designed loyalty program would have specific measurable objectives and targets, for example aiming at 5% annual increase in sale. Clear objectives helps a retailer to design appropriate loyalty strategies targeted at specific segments and
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