How retailers are cashing in on customer loyalty
More and more consumers are buying into the idea of loyalty programmes — and it’s paying off for retailers in terms of valuable information, as well as increased revenues
You’re on your way home, but need to stop by at least one of two stores. One is more convenient to get to, but the other has a loyalty programme that allows you to accumulate points that will add up to some kind of discount. Don’t be surprised if you find yourself making a detour to shop at the store with the loyalty programme just so you can get a few rands off the milk you’re buying. Many of SA’s retailers are counting on you to do this: in a difficult economy in which growth is flat, retailers are increasingly leaning on these kinds of programmes to drive revenue. The rationale is that by having incentive schemes in place, companies can build loyal followings while encouraging consumers to buy more, says Amanda Cromhout, founder and CEO of Truth, a consultancy that gives advice on loyalty programmes.
On the whole, says Cromhout, about four out of five South Africans who are economically active — those with a household income of more than R10,000 — use loyalty programmes reg...