EasyJet’s decision to trial a loyalty programme that rewards frequent flyers with perks and dedicated services may baffle those that think such schemes are only useful for gaining new business or tempting back lapsed customers. In EasyJet’s case, leisure passenger repeat bookings are up 50 per cent from 2010 and business passenger repeat bookings are up 62 per cent. Customers are already flying with EasyJet and flying more often, so why does the airline believe a loyalty programme is necessary?
Such a question fundamentally misunderstands the role that loyalty schemes should play. They should never be a replacement for flawed value proposition, but instead play a complementary role – brands should be rewarding loyalty having already earned this through other aspects of their customer-focused service.
Unfortunately, treating loyalty programmes as a substitute for a compelling value proposition is just one aspect of how these schemes are too often flawed.
Expectations of loyalty programmes are high, and often these aren’t met. It is all too common to see businesses fall into the trap of either launching a programme that doesn’t fulfil any clear purpose or to rely too heavily on their loyalty scheme. Both are deadly and totally avoidable.
A loyalty scheme is doomed to fail unless it is entirely built around the customer. Once this central point is agreed upon by all stakeholders, the strategy and design of the scheme can begin, requiring a blend of art and science.
Despite the prevalence of loyalty programmes, something is often missing – the emotional wiring. How do you want customers to feel as members of the programme? What do you want them to say about it? What do you want them to do because of it?
Too often, brands bury their heads in a spreadsheet and business case thinking about earn, burn and breakage, before considering the emotional wiring.
Great loyalty programmes should cause customers to wonder how they previously lived without them by offering truly valued benefits. A significant amount of time therefore should be spent defining the benefits that either alleviate pain for customers or enable them to achieve exclusive gains.
Meaningful rewards drive perceptions of value – and the best way to ensure rewards are meaningful is through collaborating with customers in the design process, essentially crowdsourcing the programme success. Happier customers might be inspired to share their positive experiences with others and the power of word-of-mouth to boost acquisition, retention, win-back and loyalty shouldn’t be underestimated. Real rewards are very much a hallmark of the EasyJet programme, which has clearly been devised to reduce stress for the leisure and business traveller, through the likes of priority services, a dedicated helpline, booking flexibility and price guarantees.
Brands can reap huge benefits when a loyalty programme is devised with total focus on offering real value to the customer – and when it is implemented to support a genuine value proposition. EasyJet’s recent success is just the latest example of this.
Naomi Kasolowsky is global capability director for loyalty at dunnhumby.