How to Develop Loyalty Program Objectives

Description: resentingloyaltygoals

Frequently loyalty programs begin with good intentions but with poorly defined goals.

Qualitative goals frequently include:

  • Improving customer satisfaction
  • Driving brand awareness
  • Creating a competitive advantage

However at some point loyalty programs shift from becoming an initiative to an expense that must be justified...and rightly so.

So what are you to do? Quantitative loyalty program metrics and minimum acceptable ROI should be defined prior to program development.

Quantitative loyalty program goals should include all or some of the following:

  • Increase in sales
  • Reduction in churn
  • Increase cart size
  • Increase in monthly spend
  • Increase in repeat sales/frequency of visits
  • Increase in sales of more profitable products/services
  • Minimum acceptable R.O.I.

Much like other company initiatives quantifiable goals need to be benchmarked with similar projects/programs. Therefore after defining the quantifiable objectives a business case should be built with benchmarks from other firms. Any reputable loyalty program provider will have a business case model that can be used to sanity check the quantifiable objectives.

Other factors to consider include the liklihood of switching brands. As reported by the New York Times, a study by Forrester Research determined the level of loyalty by industry. Customers were least likely to switch from retailers and most likely to switch from airlines.

If you would like to learn more about quantifying your loyalty program goals feel free to contact us at 800-287-7198 or loyaltygoals@bungeeloyaltyprograms.com.


We look forward to discussing your unique requirements. Please contact us for a no-obligation webinar at inquiry@bungeeloyaltyprograms.com