loyalty scheme

Mktg

a sales promotion technique used to encourage customers to continue buying a product or using an organization’s services. It works by rewarding customers who spend more and/or stay longer with an organization. Examples include a shopper card that gives discounts on purchases over a period of time.

     There are several other loyalty scheme approaches: points systems—which give points to customers based on what they purchase; premium customer programs—where customers who spend certain amounts of money and are repeat purchasers gain special status and receive benefits such as discounts, exclusive offers, and gifts; buyers’ clubs—where a certain number of customers can club together to buy a particular product, at a special volume discount.

     If implementing a loyalty scheme, it is important to remember that it must be there for the long term, and the level of incentive must be right. Offering too much will hurt your profits; offering too little will not attract members. Customers also need to be able to check up on their status easily—to see, for example, how many points they have currently accumulated.