There is a story about a Chinese saying which goes like this : “May you live in interesting times”. Apparently uninteresting times are filled with peace and prosperity and are hardly exciting to the human soul. Times of tumult, on the other hand, are full of excitement. So the above statement while appearing to be a blessing is actually meant to be a curse.( While the saying was attributed to Chinese, so far there is no evidence of its origins)

 So, I wonder, are we living in interesting times? If you look at the world as a whole there is plenty that is happening to make these very interesting times. But my question is focused on those who are connected to the field of loyalty marketing. It would certainly seem like we are living in interesting times..

 Turn the clock back by a couple of decades… those of us who bravely marched into the field of loyalty marketing found ourselves in interesting times—undoubtedly interesting times. Awareness of loyalty marketing was low despite the fact that a few marquee brands had launched well-conceived loyalty programs. The market was still largely a seller’s market and it was growing… the decades starting 1990 witnessed such rapid growth that marketers had no time for retention. I remember talking to the CMO of a mobile services company in the year 2004.

Me: What do you think of customer loyalty programs?

Mobile co CMO: Yes, yes, they are good, you know, customers are the most valuable asset and so I think we should retain our customers

Me: Would you consider launching a loyalty program?

CMO: But why do we need a loyalty program?

Me: Because customer attrition is very high in the industry

CMO: That’s true.. but

Me: You don’t think you need a loyalty program?

CMO: No Ram, why would I need a loyalty program? My customer base is growing in double digits every year. I am not able to cope up with the demand. So, why would I want to retain customers?

Me: But then you keep saying every week you need to launch a new scheme to attract new customers…

CMO: Don’t you understand? We need to attract new customers. We need to be visible in the media. But churn is an industry issue. Talk to any one in this field. No one is worried about customer retention now.

 In another instance I was talking to the program manager after doing a program audit. One of the audit findings was that there was not much interest in the program and they could have as well given a higher discount to the premium tier.

“Absolutely”, exclaimed the program manager, “that is exactly what we wanted to do and that is why the loyalty program”

That in short describes the awareness and attitude towards loyalty programs at the turn of the century (or millennium if you prefer a grander time zone). You had to knock on a hundred doors before you found a prospect that was interested in a loyalty program. And loyalty programs were , at least on some occasions, run for the wrong reasons! Nobody wanted to see beyond a points table. More than everything else the rewards could not be delivered to customers in remote areas. So there were always surprises, shocks and struggles in those days! You could certainly call them interesting times 🙂

 Cut to 2018.

The market was brimming with loyalty program agencies, consultants giving you the in-depth knowledge of loyalty, tech vendors who were disrupting the market with technology platforms, and customer experience was threatening to unseat loyalty( it still does!). There was a new announcement everyday, if it was not a new way to shape your customer experience, it was a blockchain based platform that made fraud next to impossible and increased the ‘liquidity’ of your points. Looks like loyalty was ready for its “day in the sun” or fifteen minutes of fame!

But wait, there is some more news. Let me present the gist of a discussion on a business forum:

A marketing manager wanted to launch a channel loyalty program and wanted his group to help him decide. And here is a short version of the discussion:

MM1: Hi all, I need to launch a loyalty program. Can you suggest a good vendor?

MM2: It is no rocket science. Go with any vendor.

MM1: What should I assess the vendors on?

MM2: Let me make it simple for you. There is no rocket science here. All you need are a) a points engine and b) a rewards vendor. Almost any points engine is capable of handling member accounts. And as far as rewards catalogue is concerned, your vendor should be able to manage the procurement and delivery of the rewards. After that it is just commercials!

MM1: Thank you. That is great! I will follow your advice. And if I get stuck anywhere along the way, can I get your advice.

MM2: Feel free to message me privately, anytime!

 There, that example seems to be symptomatic of the field of loyalty marketing. I have nothing against any of the players in the exchange, but after spending two decades building customer loyalty, I can definitely vouch for the fact there is much more to loyalty building than a platform and a catalogue. No doubt these two are critical components in the delivery of a loyalty program. But there is a lot more that you need to address before even thinking of the program delivery!

I am not saying the above exchange is typical of the situation today. There are a lot of program managers who understand the art and science behind loyalty programs and are willing to invest in designing the program well.

It is just that we seem to have moved from “ What is a loyalty program? “ to “Why do we need a loyalty program?” to “ I need it but I can handle it on my own”

And that last quote takes different forms like:

So, to me, it seems like loyalty marketing has always faced interesting times. And with the renewed interest in customer retention, it is getting even more interesting. What do you think?


#loyalty marketing,# relationship marketing,#marketing,#CRM,# Customer_retention, #reflections, #loyalty_evolution, #loyalty_story, #loyalty_awareness, #loyalty_attitudes