Creativity Exhausted?

It seems that over the relatively short 26 year history of the Loyalty Marketing business, marketers have steadily exhausted their reservoir of creativity and increasingly relied on the Loyalty Asterisk™ to make up ground.

The Loyalty Asterisk™ examples include increasing the points required to redeem a reward, adding fees to complete a redemption, and tightening expiration rules – all conditions that lessen the value of the program for consumers. It’s a game of perception that marketers are too often losing. Insiders know these rule changes must be made, though it does not prevent consumers from viewing them as evil.

It is counter-productive to attempt to influence a particular consumer behavior with rewards and recognition while placing a myriad of constraints on the same behavior. Customers end up feeling confused and frustrated, two emotions bound to engender anything but “loyalty”.

As loyalty marketing has evolved from a novel tactic to become a standard tool in the marketing mix of most major consumer facing organizations, the articulation of most programs is increasingly similar. In airline, hotel, and financial services companies, offering a program that awards points or miles for consumer patronage is essentially a cost of doing business. Whether this form of marketing strategy continues to influence consumer purchase behavior as intended will depend on how quickly the next wave of innovation emerges and can be practically applied.

Be True to the Pledge of Customer Centricity

As they tweak their program rules to reign in benefits and reduce cost, program sponsors should understand that cheap talk in annual reports about commitment to a customer centric strategy is heavily diluted by the proliferation of Loyalty Asterisk™ in their program communications.

It’s time for marketers to “say what they mean and mean what they say”. Building enduring customer loyalty is complicated enough. Don’t undermine your substantial investment in customer centricity with a generous sprinkling of asterisks. Let’s hasten the next wave of innovation in the Loyalty marketing business and stop changing program rules from becoming the most commonly communicated message in our e-newsletters.