Are customer loyalty programs too expensive?

Low-margin retailers often argue they can’t afford customer loyalty programs, but is that true? Two business professors make the case that such programs are profit-enhancing differentiators.

When location, location, location is the only means of differentiating and all is left to low margin and high prize, what to do then? Creating a non prize differentiation in this position is hard, takes time and costs money. Maybe this is why many retailers have adopted loyalty programs as a convenient mechanism of meaningful differentiation. At the end loyalty programs should offer incentives for customers to stay put with their store by offering them better value. Also loyalty programs have the added advantage of rapid establishment and making the threat of price wars from competing retailers less credible.

According to Forbes there are a number of myths over whether loyalty programs offer a sustainable and profitable business model. Dig in to the full article on Forbes.

Consumers continue to use digital coupons to stretch their budget

eMarketer forecasts that digital coupon users, which include internet users ages 18 and older who redeem a digital coupon or code via any device for online or offline shopping at least once per year, will account for 55.0% all US internet users in 2014.

The digital coupon audience is a relatively mature group, but there’s still room for modest growth over the next few years. Mobile coupon users are making up a growing portion of the larger digital coupon audience as more consumers make in-home purchases via smartphone and tablet and as more shoppers use a mobile device to enhance their instore experiences. eMarketer expects the number of adults who redeem coupons via mobile device for either online or offline shopping to rise from 78.69 million to 104.11 million between 2014 and 2016, or from 70.0% to 82.0% of all digital couponers. Younger deal-savvy shoppers who are heavy smartphone users have especially embraced mobile couponing in recent years. eMarketer estimates that only 36.5% of marketers will offer mobile coupons in 2014. By 2016, 44.5% of marketers will do so.

Next wave technology is changing the playing field for customer loyalty


Most businesses find themselves at an important paradigm shift between the next wave of technology and a new era of customer engagement.  Now is the time to redefine the way your business interacts with customers through digital engagement. Customer loyalty programs such as travel miles and cash back are not created by chance. The programs are fueled by an increased understanding of what motivates customers and what can maintain loyalty.

If your company has not taken a long look at its customer engagement strategy in recent months, it does not realize the race has started, and it is still at the starting line. Technology is upending preconceived notions about customer loyalty every day. The winners in this race will be the ones that unbundle their services to create a unique experience for every single customer who clicks on their website or walks through their doors.

Employee engagement

According to studies where Bersin by Deloitte is one of the sources “enormous changes are ahead” for the workplace in 2015. The biggest disruption in most industries this year is employee engagement.

As the workplace now shifts more and more to out of office places, we work from home, in coffee shops, on airplanes, and often late at night, HR departments sometimes have a hard time to keep up. Employees now a a days have  tools and technologies at their fingertips to find information, write, communicate, and analyze data like never before. And thanks to the growth of cognitive computing technologies, we will all soon have thinking machines in our phones, machines that monitor where we are, what work to do, what customer problems to solve, and even what HR problems to address.

Much of this transition has been positive, but much has also been difficult. Many of us are “overwhelmed employees” and our research shows that employee engagement and retention is at an all time low. While many people are still looking for work, more and more people are getting fed up with the 24/7 work environment around us, so they go to social websites like LinkedIn or Glassdoor and jobs are offered to them.

As employees  move from opportunity to opportunity their job company culture has to engage, inspire and motivate beyond salary. It puts the pressure on employee benefit companies to be as relevant as can be. A good source of offerings is key to success.

Welcome to our loyalty blog!

Connecting our clients with more than 18 000 merchants across 36 European countries with our easy to access API, Deals Distributed has become the main source of offerings covering most major industries. We don’t take a percentage of your commission and we don’t stand in the way of your valuable Merchant relationships. We give you all the tools you need to connect with leading brands quickly and easily.

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