Ask Ian: Are Customer Loyalty Schemes Worthwhile?

March 15, 20194min

Customer Experience specialist Ian Golding, author of Customer What: The Honest and Practical Guide to Customer Experience, writes for Customer Experience Magazine offering expert insight to help businesses improve their CX offering. 

To ask Ian a question on how to boost the Customer Experience provided by YOUR business, please email your question to The best questions will be featured in future instalments.

Ian also leads the CX Professional Masterclass. Click here for details of upcoming Masterclass dates.

As a smaller business, should I consider customer loyalty schemes as part of my Customer Experience Strategy? Can they add value to my business, or is it common for customers to fail to engage with them?

I have always believed that if done well, customer loyalty schemes can be extremely effective as a way of maintaining engagement with those who interact with your products and services.

By “if done well”, I am suggesting that some are not!

Typically, the domain of large corporations in the travel, hospitality, and retail industries (although not exclusively), if the ‘effort’ is effortless and the ‘reward’ is rewarding, then a loyalty scheme could be a differentiating factor in the mind of your customer.

Personally, as a frequent traveller I will always look to fly or stay with an airline or hotel that will provide me with a benefit for using them regularly. To me, the reward of ‘free’ flights or hotel stays is a worthwhile incentive to keep using certain brands.

However, the loyalty scheme alone must only be perceived as just one touchpoint in the customer journey – if other things in the journey go wrong, I will gladly give up my perceived ‘benefits’ and take my business elsewhere.

There is absolutely no reason why the principle of a loyalty scheme should not be applied by smaller organisations – as long as it is sincere and commercially viable and a way of driving differentiation.

However, there is no sense putting a loyalty scheme in place if it will run your bottom line into the ground! Also, do not forget the ‘sincerity’ part of my statement. If a loyalty scheme is perceived by your customers as a way to try to ‘sell them more’ or spam them, then it may be better not doing it in the first place.

Ian Golding

Ian Golding

A highly influential freelance Customer Experience consultant, Ian advises leading companies on Customer Experience strategy, measurement, improvement and employee advocacy techniques and solutions. He has worked across multiple industries including retail, financial services, logistics, telecoms and pharmaceuticals and has deployed Customer Experience tools and methodologies all over the world. Ian is an internationally renowned speaker and blogger on the subject of customer experience who served on the inaugural board of Directors of the CXPA (Customer Experience Professionals Association). In 2014, Ian officially became a Certified Customer Experience Professional, currently being on the UK Board of Ambassadors for the CXPA. Ian is also a regular judge at the UK Customere Experience Awards

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