Consumer loyalty programs: impact of different modalities

Abstract

The present study structures a new modality for loyalty programs and compares it with traditional approaches. Initially, described here are two modalities of loyalty programs - individual and coalition, often used, being analyzed are their main characteristics, advantages and restrictions, market ranges in which they operate and the managerial implications of each modality. Subsequently, the study proposes a new program modality (cluster) and provides practical aspects for its use. The types of loyalty (loyalty to the brand, loyalty to the store or loyalty to the program) that are intended to be achieved in each program modality were also identified. Participation of partners, accumulation of benefits, options for recovery of benefits, market ranges, program management and program focus were the analyzed variables for comparison of the programs. This analysis revealed which approaches are most appropriate for each type of program.

Keywords

• loyalty programs
• loyalty program design
• program modalities
• loyalty approaches.