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Developing a Cost-effective Brand Loyalty Program

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  • WANSINK, BRIAN

Abstract

What makes a brand loyalty program successful or cost-effective? Interviews of 41 managers of brand loyalty programs were conducted to establish the best practices for such programs. Following this, a study of 132 brand managers and a study of 643 consumers jointly show that brand managers may overestimate the importance of targeting heavy users (or frequent users) and may underestimate the effectiveness of inexpensive reward programs. In reality, low and moderate reward programs that target light users may generate higher incremental sales and may tend to be more profitable than is generally expected.

Suggested Citation

  • Wansink, Brian, 2003. "Developing a Cost-effective Brand Loyalty Program," Journal of Advertising Research, Cambridge University Press, vol. 43(3), pages 301-309, September.
    • Handle: RePEc:cup:jadres:v:43:y:2003:i:03:p:301-309_03
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    Cited by:

    1. Chen, Yanyan & Mandler, Timo & Meyer-Waarden, Lars, 2021. "Three decades of research on loyalty programs: A literature review and future research agenda," Journal of Business Research, Elsevier, vol. 124(C), pages 179-197.
    2. Mimouni Chaabane, Aida & Pez, Virginie, 2017. "“Make me feel special†: Are hierarchical loyalty programs a panacea for all brands? The role of brand concept," Journal of Retailing and Consumer Services, Elsevier, vol. 38(C), pages 108-117.
    3. Leenheer, Jorna & Bijmolt, Tammo H.A., 2008. "Which retailers adopt a loyalty program? An empirical study," Journal of Retailing and Consumer Services, Elsevier, vol. 15(6), pages 429-442.

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