By Gina Lee

ORGANISATIONS are becoming increasingly aware of the importance of putting a holistic customer loyalty strategy in place. Over the years, loyalty programmes that rewarded customers with points and prizes have taken various forms, all with varying levels of success. Now there is a greater need to engage customers on an individual basis in order to drive desired behaviours, motivate, incentivise, and reward.

Companies which take a holistic approach can benefit from results, including attracting and retaining the right customers, influencing existing customers to buy more frequently or in higher quantities, or encouraging customers to become brand advocates, spreading the word about good experiences.

Ultimately, all companies share the same goal when considering customer loyalty programmes, which is to boost sales, service, and increase profits. Good customer loyalty programmes should be self-sustaining, meaning the additional revenue generated as a result of the programme should more than cover the investment made to set up the programme and manage it on an ongoing basis.

Frequently, when companies think of putting a customer loyalty programme in place, they use offers and incentives (for example, 'Buy two and get one free') or rewards (such as loyalty cards which provide discounts or reward monies that can be spent at the brand company).

However, in today's dynamic environment, customer loyalty programmes need to include exciting and more complex loyalty solutions that build brand awareness and boost up-sell rates. Here are three different types of customer loyalty initiatives that have helped companies to increase their profits.

Interactive digital marketing programmes

Using the latest technology advancements, companies can increase the number of customer touch points, to better engage with their customers. Innovative digital marketing programmes can be deployed across the Web to help companies gather customer data and then use this information to communicate with customers, incentivise, and reward. When using these technological initiatives, it is important to remember to keep the interaction personal, relevant, timely, and in line with the organisation's brand.

BMW is one such company which has benefited from using interactive digital initiatives. First, they built a website which enabled them to collect information from their customers by asking them to complete short forms in order to obtain further information, such as brochures.

By understanding what their customers wanted, customised e-mail campaigns could then be devised for each of them. Based on information gathered, a personalised communication channel can then be opened from the prospects stage right through sales and after-sales and beyond.

Taking this one step further is BMW's after-sales programme, which aims to measure customer satisfaction and dealer performance. This programme was originally a phone-based platform and BMW decided to migrate it to e-mail and online survey platforms.

An Electronic Customer Satisfaction Programme (ECSP) linked directly to BMW's back office and customer relationship management (CRM) system, automatically triggers sales and after-sales questionnaires within five working days from the initial transaction. The ECSP resulted in more simplified reporting and action processes, which led to cost savings. More importantly, it significantly increased customers' response rates by approximately 50 per cent of the after-sales feedback.