Cabo Case

Topics: Loyalty program, Incentive, Reward system Pages: 2 (942 words) Published: April 19, 2015
Keith Calvert
Marketing 530
November 18, 2014
Individual response to the following questions (repeat question in your paper followed by your responses): 1) What are the biggest problems facing the company in terms of customer 
management and how could a rewards program help address these problems? 
 a) Customers can’t decide between choosing the “wellness” type of vacation available at Cabo San Viejo or a Hawaii style vacation. A rewards program would incentivize customers to visit the location more frequently so as to accrue points for future visits. When a customer visits the resort for the first time and signs up for a program, they may not take advantage of all the activities available at the resort because they know they will be back to visit multiple times. b) Certain customers see the total cost for the reservation and think the price is much more expensive than if they went on a vacation to a place like Cancun. Often times they are not considering the total costs associated in the vacation such as taxis, food, activities, and so on. The rewards program will allow customers to find greater value in the all inclusive price-tag by reducing the cost with each visit based on reward points. c) Over time, return customers’ expectations continually rise and the resort is faced with the task of living up to those expectations. Cabo has extremely high satisfaction rates and results in which customers say their expectations have been exceeded. When a customer returns, the resort wants to exceed their expectations again and again. A reward system that offered complimentary services to return customers would have an extremely positive impact on these types of customers. For example; a customer may want to spend a day doing an activity that cost extra money but couldn’t justify it after spending so much to book the trip. If it were possible to take part in the activity for free their second time around based on a rewards program, they would be thrilled to...
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