Posted on : 2023-05-26 01:49:30
Article : Good evening, Friday management TASK 243- Why brand marketers use loyalty cards as a promotional paywall. In the market place brand marketers offer customer loyalty programs to reward customers who repeatedly interact with a brand. It’s a customer retention strategy that encourages customers to continue buying from your brand rather than competitors. The more a customer buys or engages with the brand, the more rewards they earn. With a loyalty program, companies can offer points or benefits to c
In the market place brand marketers offer customer loyalty programs to reward customers who repeatedly interact with a brand. It’s a customer retention strategy that encourages customers to continue buying from your brand rather than competitors. The more a customer buys or engages with the brand, the more rewards they earn. With a loyalty program, companies can offer points or benefits to customers. And in return, they redeem points for discounts, free products, rewards, or insider perks. The goal is to motivate repeat purchases and build trust between customer and business.
A recent poll from Yotpo revealed that people will go the distance for brands they love. Nearly 68% of respondents said they’d join a customer loyalty program for brands they like, while 56% of those are willing to spend more with a brand even if cheaper options exist.
The action never ceases on the battleground for shopper loyalty. After Tesco introduced Clubcard Prices, ostensibly to offer more immediate and obvious savings to cash-strapped customers, its closest rival has followed suit. Sainsbury’s has started offering Nectar Prices to holders of its loyalty card. Nectar-enabled shoppers online or in supermarkets – but not in Sainsbury’s forecourt or convenience stores which can access deep price cuts, some of up to 50%, on more than 300 items across several categories. Sainsbury’s says more products will be added to the scheme over the coming months.
The prevalence and accessibility of loyalty schemes will also see consumers subscribing to multiple grocers’ offerings, rather than sticking to one, reducing the potential benefits for individual supermarkets. It is not just supermarkets that are reshaping their loyalty strategies. Boots Advantage Card holders will get a 10% discount on the retailer’s own-brand products, again in-store and online. The number of loyalty points that scheme members get for purchases falls slightly, while deeper specific discounts some worth up to a third of the cost of a product are in the pipeline. The changes reflect an evolution in consumer behaviour: instead of saving up points to use for a big purchase, shoppers are cashing them in more often to reduce their shopping bills.
Sainsbury’s introduction of unique discounts for Nectar members follows Tesco and Asda’s focus on providing competitive pricing with their loyalty schemes. These measures have become more common as consumers continue to switch from the traditional grocers to discounters Aldi and Lidl, in response to the high food prices that persist in the UK. While Sainsbury’s new scheme may help it to avoid losing market share, the grocer’s reputation as a more expensive supermarket will dilute the effects of the discounts, and it risks alienating shoppers who do not wish to become members and so will not receive the discounts.
Post your perceptive comments and inputs on consumer discounts and loyalty programs offering by the brand marketers. Our Management solution for the TASK 243 will be posted on our Good morning management article on May 29th 2023.
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