Frequency Marketing vs. Loyalty Marketing
Is there a difference between the term “Frequency Marketing” and “Loyalty Marketing”?
Although the two terms are often used interchangeably, there can be more than a semantic difference between the two.
According to Tom Friedman, President of Retail Systems Alert Group, a retail consultancy in Newton Upper Falls, Massachusetts, a Frequency Marketing program offers an “equal benefit to anyone who shops at the store without taking the customer’s value to the store into account. In the absence of other features that enhance the customer experience and drive loyalty, such programs can increase the fickleness of shoppers. Supermarket frequent-shopper cards are a prime example. Customers now carry a multitude of grocery-store cards and shop wherever it’s convenient, without necessarily showing particular loyalty to any one store. “
He states that a Customer Loyalty Program “may include a frequency component, but they also involve providing excellent service and a memorable, highly personalized experience. The reward offered should be an expression of the value of that customer’s loyalty to your business.”
He cites the granddaddy of loyalty programs, luxury retailer Neiman Marcus’s InCircle program, which confers lavish benefits, such as glitzy cocktail parties and private designer fashion shows, on customers who spend tens of thousands of dollars per year—and ignores everybody else. “InCircle still stands above the others because it rewards the best customers with a very high level of service,” he says.
Are you including customer service and other perceived value into your loyalty program? Think about ways to add excitement and make it an event and you can clearly differentiate your program from those of your competition – and truly reap the benefits.
Frequency programs are an excellent way of changing buying habits and wooing customers. Loyalty marketing can help take your program to the next level, thereby eliminating much of your competition.
Analyze your existing Frequency Program and see if you can find the missing ingredients that can turn it into a Loyalty Marketing Program.
