Category Archives: 2. Reward Programs

Blog articles in this category include everything on the topic of Reward Programs and Customer Loyalty Schemes.

PR Loyalty Interviewed on Global News Regarding End of Safeway’s Club Card

Peter Roundhill on Global News

Peter Roundhill interviewed on Global NewsOn April 4, 2014, PR Loyalty Solution’s Peter Roundhill was interviewed as an industry expert for the 6 pm Global evening news with their segment on Safeway Canada’s decision to drop its Club Card loyalty program.

Click the video below to see the full news feature.  (Note: as it is from Global News, there will be a short introductory advertisement).

Top in Class Card Changes Benefits

“MBNA’s Smart Cash World rewards program is changing. …”

Up until now, MBNA’s Smart Cash World MasterCard has been one of the most valuable no fee credit cards in Canada.  With no annual fee, the card offers members 1% back on all purchases, and 3% (i.e., 2% extra) on all gas and grocery purchases (on the first $600 spend on those categories combined per month).  What’s more, they even had a special introductory offer where new cardholders received 5% back on their first $600 of gas and grocery purchases per month for the first 6 months of the cards life.  That was all extremely generous from a card with no annual fee, and an especially generous kick-back for groceries.  5% back on $600 meant up to $30 per month!  But it looks like that has all now changed. … Continue reading

Artspoints Celebrates 100th Partner

Congratulations Artspoints Rewards!

Artspoints Rewards announced its 100th arts partner – Toronto’s Canadian Stage.  This puts Artspoints at the halfway mark to their goal of 200 arts partners by the fall.  It’s impressive what they’ve accomplished to date, and what they appear on track to accomplish over the next number of months.  We look forward to seeing how the program grows and develops.

Based in Vancouver, Artspoints is a national reward program that allows members to collect and redeem points for valuable arts, cultural and entertainment rewards.  It’s a great new loyalty program that rewards members, but does so by supporting the arts.

 

Review of “Loyalty Myths” (by Keiningham et al.)

Keiningham, Vavra, Aksoy and Wallard (2005)

Loyalty Myths:  Hyped Strategies That Will Put You Out of Business and Proven Tactics That Really Work

(Keiningham, Timothy L., Terry G. Vavra, Lerzan Aksoy and Henri Wallard.   New Jersey:  John Wiley & Sons, 2005).

Loyalty Myths is a great 2005 book that challenges 53 assumptions about customer loyalty, including those put forward by Reichheld (1996).  The authors are from Bain & Company consulting competitor, Ipsos Loyalty.

It can be easy challenging a small number of assumptions, but 53 is a lot.  Continue reading

Reasons for Loyalty Programs

12 Things Reward Programs can do for Businesses

There are many reasons why businesses embrace reward programs and invest so heavily in their implementation and maintenance.  The following is a compilation of the major functions of loyalty programs (with academic and business expert references).  Continue reading

Review of “Effects of Loyalty Programs” (by Yi & Jeon, 2003)

Yi and Jeon (2003)

“Effects of Loyalty Programs on Value Perception, Program Loyalty, and Brand Loyalty”

(Yi, Youjae and Hoseong Jeon.  Journal of the Academy of Marketing Science, Vol. 31, 2003 (3), pp.229–240).

Yi and Jeon (2003) examine how reward program characteristics affect the perceived value of programs and how this affects customer loyalty overall.  Their work examines reward programs with respect to timing and type of reward, Continue reading

Review of “Do Rewards Really Create Loyalty?” (O’Brien & Jones)

O’Brien & Jones (1995)

“Do Rewards Really Create Loyalty?”

(Harvard Business Review, May 1995)

O’Brien and Jones argue that despite the critics, reward programs can indeed enhance loyalty, when designed and implemented correctly.  It is critical, however, that program value be in proportion to the economic value of customers’ loyalty to the organization.  With references to such companies as General Motors, Neiman Marcus, AIR MILES and American Express, O’Brien and Jones’ most noted contribution to loyalty program literature is their outline of five key elements critical to a program’s success.  “Customers prefer rewards programs with cash value, relevance, choice, aspirational value, and convenience” (p.80). Continue reading

Review of “The Loyalty Effect” (by Frederick Reichheld)

Reichheld (1996)

The Loyalty Effect:  The Hidden Force Behind Growth, Profits, and Lasting Value

(Reichheld, Frederick F., Boston:  Bain & Company, Inc., 1996).

2001 Revision

A highly respected authority on the topic of customer loyalty, Reichheld (1996) notes that, “on average, U.S. corporations now lose half their customers in five years, half their employees in four, and half their investors in less than one.  We seem to face a future in which the only business relationships will be opportunistic transactions between virtual strangers” (p.1).  Also, “in a typical company today, customers are defecting at the rate of 10 to 30 percent per year; Continue reading

Review of Article by Nunes and Dréze (2006)

Nunes and Dréze (2006)

“Your Loyalty Program Is Betraying You” 

(Harvard Business Review; April 2006, Vol. 84 Issue 4, pp.124-131.)

This is a very valuable article and can be purchased from the Harvard Business Review (and no, we aren’t paid to say this).

In this excellent article (one of our favorites), Nunes and Dréze (2006) identify five main objectives, five critical components and five common mistakes of loyalty programs.  The authors present, in their opinion, what an effective loyalty program should look like and they give a broad overview of loyalty programs. Continue reading