2 Ways to Fix Customer Loyalty Programs

Since 2008, the number of consumers who feel that such initiatives don’t offer any real value jumped by 50%, according to a study by Forrester Research. The same study also found that almost one-third of consumers say that loyalty programs don’t influence their purchase — that’s up from 22% in 2008.
Why the dissatisfaction? Let’s call it the Groupon factor. Since 2008, there have been a flood of daily deal merchants, like Groupon and LivingSocial, that have filled customers inboxes with irrelevant offers. (Groupon itself has recently employed a Pandora-like “thumbs up, thumbs down” rating system to tackle this problem, which is best illustrated by the example of middle-aged men getting offers for bikini waxes.)
Proponents of loyalty programs, however, believe help is on the way thanks to two factors — better targeting and mobile payments.