Impact of loyalty programs in retailing business in India for creating long term relationships. Various topic on sutomer loyalty and loyalty program has been covered.

1. Impact of loyalty programs in retailing
business in India for creating long
term relationships
- Lovekshitij Suryavanshi
- Customer Relationship Management

2. Why Loyalty Programs?
• Dynamic Competition
• Good relationship with customer is must
• Long term relationship
• Target customer acquisition more accurately
• To increase customer retaining rate
• Acquiring data: e.g: Monthly spend
• Move customers up the spend band
• Loyalty impacts profitability

3. Loyalty Program Initiatives

4. Loyalty Program Initiatives
• Focus on the best customers that you already
have
• Optimize the profit that can be made from
customer
• Increase the period in which they remain
customers
• Be able to produce measurable results of
success

5. Factors which influence Loyalty
Programme

6. Factors which influence Loyalty
Programme
• What proportion of turnover should a loyalty
programme cost ?
• How long should it take before it begins to pay
back?
• Product Range and Stock Selection
• Promotional and Advertising cost
• Geographical targeting
• Ensuring success of loyalty programme

7. Goals of Loyalty Programme

8. Goals of Loyalty Programme
• Customer Satisfaction:
- Result of a subjective valuation whether
consumption fulfill or exceed expectations
- Customer satisfaction is a key issue
- Assumption: Happens when expectation is
matched to the actual result

9. Goals of Loyalty Programme
• Customer Loyalty:
- Prevents the switching of customers from
the organizations to competitors
- It is a notion to describe the end result of a
relationship between the company and the
customer
- Acquire Customer Loyalty : company provide
benefits

10. Goals of Loyalty Programme
• Customer Retention:
- Outcome of customer’s experience with firm
and products
- 3 factors:
Customer satisfaction,
Affective commitment and
Calculative commitment

11. Types of Loyalty Programme

12. Types of Loyalty Programme
• Rewards:
Awards points for purchases
• Rebate:
Award a gift coupon redeemable for the next
purchase
• Appreciation:
- Offer a rebate, not the cash
- appreciation reward points can be redeem at
same company
- e.g: Airlines, Hotel, Mobile etc

13. Types of Loyalty Programme
• Partnership:
- Reward the consumer’s accumulated purchases
with a partner’s products or services
- e.g: Tata’s Westside, offer a discount if consumers
make payment above Rs. 2500 with ICICI debit card
• Affinity:
- Value added benefits and bonuses and recognition
as a valued consumer
- e.g: Bank’s Debit cards, gold and silver debit cards

14. Benefits of Loyalty Programme

15. Benefits of Loyalty Programme
• Increased Customer Spending
• Reduced cost to serve customer
• Increase customer spending on Higher Margin
Products
• Increase referrals from existing customers
• Increase Customer Lifetime Value
• Select Stock lines effectively

16. Loyalty Programmes in Retail

17. Loyalty Programmes in Retail
• India’s Largest Loyalty Card:
Payback India: 12 Million+ members
• Hero’s Goodlife: 10 Million+ members
• State Bank Group’s – World’s Largest:
Freedom Rewardz : 110 Million+ members
• Indian Oil’s XTRAPOWER + XTRAREWARDS:
3 Million+ Members