Customer loyalty

Customer loyalty, not just customer satisfaction, is key to the success of an organization, and customer loyalty is fostered when a firm or business does extremely wells along two dimensions namely design of its products and operational Execution. Many companies focus on rewarding customers who have repeat purchases. Such reward programs have their place in assuring customer loyalty. However, if the product or service doesn't meet customer needs, no reward program will keep them returning. For success in the long run, an organization must continuously improve and quickly identify and resolve problems to the customer's satisfaction. The key challenge in developing an effective rewards program is researching the key elements that will drive loyalty. Many companies assume that gifts will drive return purchases. That might prove to be a bad assumption.

Other methods of customer loyalty programs often refer to the use of processes coming from classical promotional techniques, urging consumers to multiply and perpetuate their purchases through rewards in the form of vouchers or loyalty points. Other programs of the frequent flyer type more clearly resort to the notion of service continuity, putting up barriers to prevent exit. Clubs also make part of this array of customer loyalty development tools, the wine, book, record or video sectors having acted as pioneers. Favoring differed payment by means of a credit, whether free or not, equally permits to boost loyalty. The loyalty card therefore becomes the credit card. Two general phenomena can account for the varied success these customer loyalty programs may have. First it is the double jeopardy phenomenon that indicates brands with large market shares at once hold a greater number of loyal customers, but also big consumers. One may therefore expect programs led by leaders to prevail. Then, there being greater loyalty to products with high involvement one may very likely expect loyalty programs to be more efficient in that context.