I read a great interview in the Working Knowledge website today. In Loyalty: Don't Give Away the Store, Rajiv Lal talks about his key learning about loyalty marketing in the grocery industry:
Reward your existing, loyal customers, without incurring a major cost by doing so. Positively affect the behaviors of not-so-loyal (worst) customers, especially middle-tier customers. Find out who the high potential customers are, the ones whose behavior is worth modifying. That is where I think the biggest bang for the buck is. Effective, targeted merchandising and service.
I would add that the best reward for a loyal customer is to provide the best shopping experience - a combination of price, ease of shopping and great levels of service. Do that well, and I'll keep coming to your store, whether or not I get "points".
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