Do Customer Loyalty Programs Aim to Increase Loyalty

Despite the rapid growth of customer loyalty programs, both in their numbers and in breadth of application, there has been little empirical research into their effectiveness. What little research has been conducted has suggested that they have failed to achieve their original objective of significantly increasing loyalty levels. The results of this study of Australian customer loyalty programs suggest that rather than expecting the programs to facilitate stronger relationships and to deliver loyal customers, Australian managers of large-scale national programs assess the performance of their programs according to more short-term criteria that prioritise profit over relationships.