Do loyalty programs really affect consumer loyalty ? What effect do loyalty programs have ?
Back in 1997 Anne Sharp and I published the first empirical evaluation of a large scale loyalty program:
By using Dirichlet benchmarks we were able to assess the loyalty program’s affect on repeat-buying while avoiding the problem of self-selection (i.e. more loyal buyers of the brand are more likely to join the program). We documented weak effects.
Since this study we, and others have done more work. All using real world panel (i.e. individuals repeat buying) data. This evidence will be brought together in a forthcoming report, and possibly a chapter in my forthcoming book “Laws of Growth”.