Corporate Loyalty Programs Need to Change to Membership Programs - Develop "Indispensability"

As reported by the 4/29/2010 issue of Colloquy:

"According to an article in Marketing Magazine UK, despite 86% of the population using retail loyalty cards on a regular basis, 50% of shoppers do not think it is worthwhile collecting points, according to a new survey conducted by YouGov SixthSense.

The report also found that 93% of consumers would continue to shop somewhere, even if the retailer scrapped its loyalty program. Only 17% of respondents choose where to shop based on their participation in loyalty card programs.

The top loyalty programs, in terms of usage, show that consumers participated in more that one program, with Tesco Clubcard being used by 66% of those surveyed, Nectar by 55%, and the Boots Advantage Card by 48%.

"Loyalty programs need to do more to create customer loyalty. The programs are best suited to retailers that are used frequently or where loyalty cards can be used in multiple stores, so that points and rewards accumulate at a fast enough rate to keep people interested", stated James McCoy, research director for YouGov SixthSense.

The online survey was carried out between February 18 and 20, and 1,469 British adults took part."

Corporations can learn a lesson from Membership Organizations by stepping up their "loyalty programs," by working to become indispensable to their customers.

Associations work to not only service their 'customer's' current needs, but to anticipate them. There in lies the difference - loyalty programs reward for the present whereas membership programs provide for the present on a more individual level as well as anticipates the future needs of their "customers." We discuss a 'customer life cycle' where we develop products and services for our members at different stages of their career or membership cycle.

If corporations want real loyalty, they need to not only be a friend today by providing benefits now, but be a friend tomorrow and anticipate their customer needs move over the time of their customer lifecycle.