Referring to Summer’s blog, I personally agree with her proposition that companies have not done enough to make customers “loyal” through the more commonly used customer loyalty programs, Simple Point System.  Summer mentioned that this system gives customers headache as customers barely have time to keep in track the amount of points accumulated. More simply said, this program is just not effective.

To businesses like Save-On, Safeway and Shoppers, the customer loyalty program is beneficial to them in a way. By name, the phrase “customer loyalty programs” refers to an initiative in which efforts are made to induce loyalty from customers, so that they will not be attracted to go to competitors who may offer better offerings. However, another purpose that serves more importance to businesses (which is to obtain information about customers’ purchasing behavior) often makes businesses to forget the former purpose.

As a customer of Save-On myself, I do my grocery there every week, in the hopes of getting rewarded a free product or maybe just some cookies, in exchange with the accumulated points that I have. Usually, it would say on the price tags “Redeem this product with xxxx points”. And when I look back at my previous receipts, my total accumulated points are only 3-digits. In the system, you earn a point with an expenditure of $1. So, basically, I have to spend about $1000 before I could get a free cookie? This is in part, frustrating to me as a customer. I will just never reach that level.

As in this case, I would say that the program is ineffective in the sense that it is unrealistic. When customers like me realize that they would never get awarded when the redemption points set so high, why would they stick to Save-On? We could just go for other places that offer better prices for the products that we want.

All in all, there is definitely service gap occurring in this scenario. After customers give up their personal information to businesses, they expect businesses to do their part to reciprocate what they have given.

Reference:

https://blogs.ubc.ca/qianyusummerli/2013/10/08/is-customer-loyalty-dead/