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Loyalty Programmes Balloon Across Segments
Economics Times - Bangalore, April 6, 2004. Actual
Published Format |
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| BANGALORE: Customer
loyalty is utopia for any brand — especially
in the current overcrowded brand market. Brands
are going all out not just to woo new customers
but also keep old ones coming back. Most often because
of their top-of-the-mind recall, loyalty programmes
have been associated only with frequent flyer miles
and credit card points. This trend is changing as
diverse service and product providers, ranging from
apparel brands to even builders, are leveraging
technology and finding innovative methods to ensure
customers stay devoted. |
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| But loyalty programme, says
Mr Praphul Misra, director & CEO, Netcarrots
Loyalty Services, is not just about retaining customers.
“Primarily, loyalty programmes are used to
gain consumer insight and for the accumulation of
accurate data to map consumer preferences,”
he says. NetCarrots specialises in the construction,
design, conceptualisation and management of loyalty
programmes for companies. |
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| For builders Purvankara
Projects, a loyalty programme is certainly
a first — not just for them but perhaps for
this genre. Owners and residents of Purvankara properties
are offered a bouquet of tangible and intangible
services and benefits for various needs ranging
from home improvement to movie ticket delivery and
restaurant services available through a dedicated
hotline. |
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| Apart from this, a referral programme
allows a privilege member to avail a reward by referring
another person to buy a Purvankara property. For
instance, a Rs 25 lakh product would reward the
person making the recommendation with Rs 25,000,
50% of which can be encashed and the remaining availed
through their various tie-ups with manufacturers,
stores, restaurants, et al. Presently, the company
has about 5,000 families as privilege members and
hopes to up it to about 15,000-25,000 over the next
year. |
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| “Through this, we can create
a larger marketing network and also leverage the
company’s goodwill,” says Mr Girish
Purvankara, director, Purvankara Projects. In the
last couple of months, he says, the company has
sold over 50 apartments just through owner recommendations.
Presently, the company spends about Rs 50 lakh on
running this loyalty programme and in the
coming year expects to increase it by 20-30%. |
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| Terming them “programming
devices” to elicit desired behaviour from
customers, Mr Misra says such programmes are sometimes
used to activate customers. Take the case of the
Rs 408-crore DND (Delhi-Noida-Delhi) Flyway built
by the Noida Toll Bridge Company (NTBCL). The flyway
has about 55,000-60,000 vehicles traversing over
the Yamuna river everyday, of which about 37% are
prepaid toll users (that is about 20,000 people
with silver or gold prepaid cards), who avail as
much as an 8% discount on toll fees for being members. |
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| “Although the awareness level
is still low, we expect the number of users to stabilise
at about 50% of the total DND flyway users in a
little over two years,” says Mr Pradeep Puri,
managing director, NTBCL. At present, the company
earns about Rs 8 lakh a day though toll and other
fees. DND privilege miles are earned by DND members
every time they use the DND Flyway and can be redeemed
at programme partner outlets. |
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| As homogeneity cements itself in
the marketplace, this trend to create allegiance
among customers in innovative and “privileged”
ways will continue to find more outlets and has
even transcended geographic boundaries. For instance,
makemytrip, a site on which air tickets can be booked,
offers anyone who books a return trip to India coupons
redeemable at various Indian brand outlets. Costing
the company about Rs 6 lakh per year, ‘Trip
Saver’ as the programme is called, is being
developed as a major differentiator in the competitive
landscape and in the process takes customer delight
to the next level, says Mr Deep Kalra, CEO, makemytrip. |
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| Loyalty
Programs :: Relationship
Programs :: Technology |
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