THE PSYCHOLOGY OF LOYALTY PROGRAMS

The reward proposition is what drives customer behavior

But what behavior would we like to change / drive?

REINFORCEMENT

Members who successfully attained a reward exhibited increased effort and drive in subsequent attempts to reach a goal

BEHAVIORAL POTENTIAL

BP = f(E+RV)

A recent report by Collinson Latitude found that expectancy and reinforcement value are issues for loyalty program members

GOAL GRADIENT EFFECT

Collinson Latitude found that the Goal Gradient Effect is clearly observable in loyalty programs

ENDOWED PROGRESS EFFECT

SUMMARY

The reward proposition is what drives customer behavior

Collinson Latitude found that positive redemptions drive future earning

Publisher & global speaker on hotel & airline loyalty programs.

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