The paper aims to highlight common mistakes organizations make when designing loyalty programs and provides the reader some questions to ponder before spending money in the pursuit of loyalty. It is based on a review of 300 journal articles.
The paper is based on a detailed review of literature, and the author's observation in researching loyalty over the last three years.
Loyalty is of many types and the biggest mistake organizations make is thinking they all need attitudinal loyalty. This is not so and organizations should look at the industry, customers and more importantly their own goals before deciding how much money to spend.
The study prioritizes perceived value, satisfaction, behavioral loyalty and attitudinal loyalty in the context of the organizational goals and industry. It provides a simple process to relook ROI in loyalty programs.
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