Loyalty programs and benefits are booming in Australia, with airlines, supermarkets, chemists, fashion chains and bookstores offering membership programs.
But as more shoppers take advantage of these options, there are a growing number of industries adopting loyalty-based strategies.
But recent membership changes at Fitness First mean that frequent visitors can choose to end their membership at any time. The gym giant released a statement in January 2014 explaining that it was changing things “for the best”.The fitness industry, for example, is renowned for its inflexibility – especially when it comes to gym memberships, which often force people to sign up to contracts or pay exorbitant fees to work out once or twice.
“In recognition that people join them for a reason, a season or a lifetime, Fitness First has redefined the member experience with unbeatable flexibility,” the company says.
As well as now offering Pay As You Go memberships that are an “industry first” in Australia, the company’s new “Fitness Guarantee” means that any member who averages three visits a week can cancel their contract at any time. Fitness First Australia’s Managing Director, Pete Manuel, has said these changes are a “clear statement that we want our members to stay with us and reach their goals”
“This may not be what you’ve come to expect of the fitness industry, but we’re leading the way because we truly want you to come to the gym,” he writes in the Jan/Feb Fitness First magazine.
The Many Forms of Loyalty Rewards
This news from Fitness First also highlights a focus on loyalty and the value of regular customers, not just in the fitness world but also across many different industries.
Supermarkets, fashion retailers and airlines are the most proactive companies, with their competitive loyalty programs and rewards for frequent shoppers and fliers often discussed in the media. These programs give you points for what you spend in store and sometimes also offer gifts for frequent visits or specific dates, like membership anniversaries or birthdays.
Even cafés are in on the loyalty program game, with almost every coffee shop in the country offering a loyalty card that eventually leads to a free drink after so many other purchases.
Hair salons, day spas and massage parlours may also offer benefits for customer loyalty, particularly when it comes to rebooking. The successful Australian hair salon company Oscar Oscar, for example, offers a 10% discount for customers that rebook at the end of their visit, as well as seasonal promotions and events for people signed up to its VIP newsletter.
Then there are the exclusive offers telcos provide to long time customers, like phone and internet bundles at a reduced price, or mobile phone upgrades with different plans. Optus even has its Yes Rewards promotions, which include $10 movie tickets and the opportunity to earn Qantas Frequent Flyer points for making bill payments.
Similarly, gas and electricity providers advertise “discounts” for people who choose to have all their utilities with one company and will go to great lengths to keep customers on their books if competitors are trying to lure them away.
But are these loyalty rewards and benefits really worth it? On the one hand, the discounts, offers and other benefits can save consumers a little or even a lot of money. On the other hand, however, signing up to many different loyalty programs can be overwhelming and lead to more time spent sifting through promotions than actually gaining any value out of them.
Marketing consultant and author Barry Silverstein also points out that these programs can serve the companies just as much as the consumers (if not more).
“The classic brand loyalty program offers a combination of rewards and recognition,” he explains in an article for brandchannel.
“The bottom-line objective of the program, however, is retention – to ensure that a customer continues to purchase a product or service and remains loyal to that particular brand.”
Loyalty, in essence, means business for these companies. So it is basically just another way for them to increase, maintain or guarantee profits, which keeps both execs and shareholders happy. In turn, that means many companies shape their strategies and promotions with a goal of fostering customer loyalty.
Whether or not these programs and promotions work, however, is up to the customers. Sometimes the value provided through a loyalty program or initiative will be great, and sometimes it may not really be worth it.
Whatever the case may be, being aware of these strategies and making informed decisions about them puts the power back into the people’s hands. And that, in the end, gives businesses even more of a reason to value their customers.
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