Loyalty Program Essay Example for Free

Loyalty Program EssayWe go through 7 dodge steps to design a lealty plan for Cabo San Viejo which are as follows Before we suggest a customer rewards or loyalty chopine, it is important to understand what is the partnerships long term vision, For whom this program is to be implemented i. e. who are the companys outgo customers, what are their film and expectations, the reasons for having such a program and the expected outcome.So the first question is What is Cabo San Viejos long term vision? Was the company directing its activities in overall achievement of this vision? The vision of the company was to help people eff healthier gos. Initially in that location was a gap between the operational objectives of making people doze off weight by way of low calorie diet and the vision of getting people to live healthier lives by inculcating sustainable lifestyle ways. However, this gap had been bridged but the positioning gap remained. Who were Cabo San Viejos targeted cus tomers? Was there any gap between targeted and actual customers?If we go by the vision statement, anybody wanting to live a better and healthier life was Cabo San Viejos targeted customers. These could include smokers, obese men and women, even obese children, emphasize couples or singles, workaholic professionals, over worked top executives and managers etc. However, Cabo San Viejo was attracting in general females (70%-80% of the guests) with an increasing average age over the years, the stand up average being 57 in the year 2004. Thus, mostly older females were visiting the resort who treasured to indulge themselves and feel better about their body and themselves.Also, their household income was high. Comparing this with the summer guests, the latter company had less income and was also comparatively younger in population. Thus, we can link the age, income level and affordability. Usually younger people are less wealthy and thus find such vacations expensive. Not only this , the lore of Cabo San Viejo first as a fat clique and then as a boot mob was discouraging people to come there. Also, 67% of guests came through word of mouth indicating that the above line trade was performing poorly.Campaigns targeting specific groups of people showing indulgence in activities of their interest like hiking for young crowd, health club treatment for women, consultation for couples etc would be likely to bring out the varied health solutions offered by Cabo San Viejo. What were the involve of the guests at Cabo San Viejo? Was there any gap in meeting the needs or their expectations? The individual needs of the customers varied quite a lot. To understand and cater to the needs of the customers, the company had efficiently trained its substitute staff who helped customers choose the appropriate package as according to their goals and objectives.The very fact that 95% of the customers rated their fetch as either very good or outstanding shows that Cabo San Vie jo was operating efficiently. However, if Cabo San Viejo was to target a more(prenominal) demanding and younger customer base in future, it would slang to exceed is current delivery promise. The needs have been met but the expectations of retroflex customers have non been satisfied some of whom have expressed their resentment for not being rewarded for their continued patronization. Therefore we have recognized Perception of Cabo San Viejo as a boot camp needed to be changed. Young customers needed to be attracted. As they had higher expectations and smaller pockets, loyalty program needed to focus on grade proposition by means of discounts etc. Older customers were mostly wealthier and would not be looking for a value deal like the younger customers.Cabo San Viejo had around 5000 repeat customers each year which a healthy figure is making up about 60% of the union arrival figure. Around 3500 new guests arrive each year of which 32% revisited within 5-6 years and 62% of repeat visitors returned again within 5-6 years. The primary reason for not returning was the high be. Here we ingeminate that to attract more repeat customers, value must be offered.Why does Cabo San Viejo need a customer loyalty program? Retention One of the primary reasons for most loyalty programs is o retain the loyal customers by appreciating them and the business they generate for the company by making them feel special and good about their association with the company. Offer enhanced value proposition A loyalty program which offers a value deal to its customers who need it will get Cabo San Viejo more patronization. However, it is to be understood that not all customers need or expect value deals. Enhanced Satisfaction Recognition by way of loyalty program makes a customer feel good and thus enhances satisfaction which in turn leads to more constructive word of mouth. Positive Word of Mouth Around 60% of Cabo San Viejos customers called in for inquiry ground on word of mouth. Enhance image as a responsive company Cabo San Viejo explicitly encourages customers to kick if unsatisfied. It is through such feedbacks that Cabo San Viejo has got to know that customers expect such a program implementation.Whenever a company asks for and receives complaints, it is best to respond or may lead to customer resentment. Counter Competition If not rewarded for loyalty, customers may thrash to other competitors. How much is the desired/expected impact? Having analyzed this, we now estimate the impact. The impact of a loyalty program is usually incremental and observed over a period of time. The expected increase in retention is say, 10%1 over a period of say, 5 years2. Also, people orgasm from reference is expected to increase over the years enabling the company to cut marketing costs elsewhere. 1The expected retention percentage is found either based on internal company selective information or industry expert advice.