What is Loyalty?
Proposition Development
There are several golden rules to be observed when developing a winning customer loyalty proposition. But before proposition development there must be customer understanding. It is most important is to gain a real appreciation of the audience for whom the proposition is intended. Beyond the customer socio demographic profile, we will explore some of the following:
- Will the customers engage with a recognition system a reward strategy or both?
- How do they want to be recognised and/or rewarded?
- Is the sought after desirable customer behaviour attainable, even with the recognition/reward?
- What will be the best approach to be effective but economically viable customer communications?
Therefore customer alignment with a loyalty proposition is critical to its overall success. Whilst this is manifestly obvious, in many cases it is often not given the requisite attention is deserves and is a source of underperformance and in many cases programme failure.
Many organisations starting point when developing the customer loyalty proposition is the cost to the organisation – organisational alignment with the proposition. Costs are most often justified with unrealistic forecasts of compliant customers delivering sustained and in some cases incremental revenue streams. Another source of internal motivation is the obsession to either reward only the ‘best customers’ or ignore them in preference to customer acquisition. Furthermore, most large orgainasations are not ‘joined up’ around their customer. This is where LCUK can deliver exceptional value as customer loyalty practitioners, agents of change and/or the people not afraid to ask the hard questions that internally never get asked as the customer is often shared across the organisation resulting in a very disjointed customer experience.
One of our key learning’s is that above all a loyalty proposition for the customer has to be simple to understand and easy to engage with. This however is often complicated by the need to deliver consumer relevance to a diverse set of customers. Loyalty Consulting UK have worked for a number of clients helping them to deliver the required simplicity and diversity within a proposition that in turn delivers very effective results.
The development of a loyalty proposition can bring together parts of an organisation that naturally compete for customer value, mind share and time. We help Financial Services organisations to find a way to harness this natural business tension in order to achieve the greater objectives sought through customer management.
