Myth: Enrolling a customer in a loyalty programme will result in loyalty
Reality: Improvements in loyalty from loyalty programmes are fleeting unless programmes can be made exclusive.
Facts: Marketeers can expect to see a 6% positive boost in loyalty from programme membership. However, the positive effects wear off as consumers join competitive programmes.
Action Steps: Rather than focus on programme penetration, lean towards programme exclusivity. Concentrate on acquiring category entrants and stealing—not sharing—programme members.
Source: Reichheld, Fredrick, The Ultimate Question, Boston; Harvard Business Review Press, 2006; Marketing Leadership Council research, 2008