How to Effectively Boost the Attractiveness of a Travel Loyalty Program with Point Loans?
Designing, implementing and managing loyalty programs is an extremely complicated process, that apart from technological background, long-standing experience and knowledge of effective motivating mechanisms, it requires a deep understanding of customers’ expectations and the eagerness to adjust the offer according to their needs.
It goes without saying that rewards are the centre of loyalty platforms. Therefore, making sure that their structure and regulations should comply with the highest standards is crucial. Moreover, they need to be designed in a way that is as appealing as possible to achieve a maximum customer impact and to efficiently provoke the expected behaviour. Despite the obvious aspects that determine the attractiveness of the rewards such as a real value of the product, its common availability and social connotations, a significant factor that influences consumers’ involvement is whether they feel like these bonuses are achievable. According to studies, one of the top reasons why consumers stop participating in a loyalty program is that it is too hard for them to earn points for rewards (54%). Therefore, it is vital not to overlook this part of loyalty building operation which is associated with the psychological layer and calls for a sense of intuition and the ability to find the perfect balance between encouraging the clientele to gain points and allowing to redeem them.
Since distant rewards can be discouraging and alienating to the program members, implementing various options to keep their attention at the desired level can be transformative and bring considerable profits. Being aware of this fact, we introduced a brand new addition to the Comarch Loyalty Management solution for the travel business which can serve as a form of preventing the potential traveller’s loss of interest. The new “Point loans” option gives members an opportunity to get the awaited reward earlier than expected by loaning them the fixed amount of points that are necessary to complete a specific redemption. This credit can be simply chosen during the transaction process and will be automatically payed off as the system will detect new points being accrued to the customer’s account. Furthermore, if required, this functionality can also grant loan in case of the need for the accrual reversal of already spent points. It also needs to be noted that the program stakeholder will have full supervision over the amount, frequency and number of loans allowed per member as well as the tiers that this privilege will be available to (the elite tier). If needed, as every other loan system, this service can be Connected with a special fee that can be compensated in a form of money or points and needs to be repaid by the restricted deadline, otherwise either the member’s card will be charged or their account will be blocked.
The introduction of “Point Loans” creates a positive environment where rewards are more attainable and the consumer feels like the benefits are not abstract and far-off. Since this option is available mainly for the elite members, it can be a powerful tool of showing the appreciation and trust which not only makes the most loyal consumers satisfied, but also maintains their engagement and willingness to stay committed. Thus, offering this function is a step towards keeping the loyalty program dynamic, exciting and effective.
 Source: Colloquy “Customer Loyalty in 2015 & Beyond”