Is Your Loyalty Program Improving Customer Retention?

Is your loyalty program equipped to handle the uncertainty we are living in today? It's time to take a long, hard look at your current program and make a solid plan to ensure short-term as well as long-term engagement and customer retention strategy. If your loyalty program isn't improving your customer retention, you may want to conduct a health check. In this blog, we will explore the 5 key elements that help define the success of a loyalty program both in the short term as well as in the long-term. 


Unhappy customers can cost you a lot of money. You can measure customer satisfaction to find out where you currently stand. This is not an easy KPI to measure and needs in-depth research, investigation, and analysis to understand it fully. As a brand, focus on answering some of these key questions to measure customer satisfaction with your loyalty program:

  • How attractive is your loyalty program and its individual parts (speed of rewarding, status levels benefits, etc.)?
  • Are members willing to recommend your loyalty program to friends and family?
  • How impactful is the customer experience?
  • Are we brand-centric or customer-centric*?
  • Is the customer journey consistent across the loyalty lifecycle?


To set up and run a successful loyalty program, you must set clear goals and KPIs that will help your business monitor the loyalty program’s outcome. The key metrics and KPIs should be able to answer the following questions to ensure you can measure your business performance effectively:

  • Are they aligned with the overall business goals?
  • What is the share of active vs inactive members?
  • How is the member data quality?
  • What is the purchase frequency of members vs. non-member?
  • What is the market penetration of the brand and loyalty program?


Technology plays a key role in the successful execution of a loyalty program. Evaluation of the organization’s information technology infrastructure, security policies and operations connected with the loyalty program with respect to the following aspects is a must: Customer Touchpoints, Customer-centricity (UX design), Systems performance, System architecture and integrations and Robustness of Business Processes (risks of frauds). Brands should assess the strength of their technology stack in supporting their loyalty program goals. 


Loyalty program liabilities and revenues impact a company’s balance sheet and income statement accounts. These financial items depend on the program value proposition and may be represented by the following: Breakage (Loyalty Currency), Loyalty Program Liabilities, Cost Per Point, Operational costs of running program (overheads, communication campaigns), ROI and more. Determine the key financial KPIs that define the success of the loyalty program as well as the business. 


Brands always want to ensure that they have an edge over their competitors. The collection and review of information about competitive customer programs is an essential tactic in finding out how your competitors are doing and what kind of threat they present to your loyalty well-being. Analyze your competitors in the following criteria: Member group size and business volume, Number of main differentiators (USP), Features and member benefits up to market trends, Customer Journeys (e.g. complexity of registration) and Presence in marketing channels.

Loyalty Program Health Compared to Industry Benchmarks

This entire loyalty health check process can be an intense, overwhelming, and time-consuming process but it is necessary in these unprecedented times. Loyalty Program Health Check is a proprietary Comarch service that helps all brands operating mature loyalty programs determine where they should redesign their program value proposition or improve key processes in their loyalty program to build stronger relations with customers. Our consultants can provide you with a diagnosis and recommendations on which the area’s most urgently require improvement and what strengths you can leverage.    



Bindu Gupta
Bindu Gupta
Loyalty & Marketing Strategist

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