Loyalty Programs and Their Importance

Riya Gupta, Aparajitha Srinivasan

Abstract: In todays world, it is considered of great importance to retain customers as they are only loyal to their convenience. The launch of the loyalty programs was a result of the dynamic environment of the Indian retail market which forced the retail agencies to focus largely on customer retention. A company offers its loyal customers with rewards programs which includes incentives such as entry into exclusive events, free merchandise, discounts, coupons, points, etc. to increase their customer base as well as enhance customer retention. The goal of this study is to obtain a deep understanding of the ideologies used by Indian companies such as Van Heusen, Westside India and Pantaloons India Ltd. while developing their loyalty programs and also understand the techniques used for developing them. The importance of the loyalty programs has also been determined.

Keywords: Loyalty Programs, customers, Customer Retention