Cabo San Viejo - Possible Solution

Topics: Customer, Customer service, Consumer behaviour Pages: 3 (817 words) Published: October 24, 2008
Cabo san viejo – rewarding loyalty?
Cabo san viejo is currently facing a problem of increasing competition and customer retention. To solve this, there is a dilemma of adopting a loyalty program or not. However our mission is only to meet competition and increase sales and not to resort to loyalty programs. We considered the following factors before deciding against choosing a loyalty rewarding program. facts

In a survey, of 2500 Americans nearly 50% of the loyalty program members said that special treatment is important to them, yet only 7% said that they get special treatment from their loyalty programs. These numbers are reminiscent of statistics that show that a very large percentage of senior executives feel that they are developing relationships with their customers while only single-digit percentages of those same customers believe so. Research results such as these indicate that consumers perceive a ton of value in loyalty programs and use them often to earn rewards. But, they have precious little to do with loyalty. Our inference

Don’t confuse loyalty programs with loyalty. At the end of the day, these programs drive short-term behavior, not loyalty. Most customers are in it for the points and the rewards that come with them, not because they hold the company in especially high regard. Some revelations

Why does a company have to “buy” loyalty?
Aren’t the benefits and activities promised by the value proposition enough to attract and keep customers? Do loyalty programs influence customer behavior?
We at cabo believe
Loyalty programs do influence customer behavior. But, if we are looking to build long-term customer loyalty, the kind of loyalty that is grounded in an emotional connection, we should not go running off to start a loyalty program. The special treatment that customers crave and that they don’t get from loyalty programs will have to come from a concerted effort on our part to treat customers well, to demonstrate our...
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