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The link between simplicity & redemption

Brands have begun to realise that true value for the customer lies in high redemption rates,

which in turn, also reduce the weight of loyalty on the balance sheet.


Apart from lightening the balance sheet liability, higher redemption drives a greater brand

experience, increased customer loyalty (creating a longer term asset) and greater customer

data insight (triggered through increased transactional volumes) and, therefore, the

greatest opportunity to achieve customer centricity.


The more complicated a programme the further you will push your members into the hands

of your competitors. One too many hurdles will get your customers turning their back

on you.


There are many factors leading to low redemptions rates, these include:

  • Complicated earn and redemption rules
  • Too many hidden hurdles/steps in the process to redeem
  • Unappealing rewards
  • Low to no engagement once a member has signed up to a programme
  • Irrelevant rewards
  • Irrelevant, impersonal communication
  • Poor customer experience across channels


As you can see, there are many reasons influencing low or even no redemption. One in

particular, which we find many programmes still fail to deliver on today, is customer

engagement, post the sign-up process.

Customer engagement really begins once a customer has signed up to the programme and

is a key driver to high redemption rates (and therefore, customer satisfaction). Customers

need to be reminded of the value that companies are offering and the benefits they are

eligible to receive.


This can be as simple as a monthly statement indicating specific loyalty offers and any rewards or points balance. However, this can also be as dynamic, personalised communications offering relevant vouchers, offers or benefits.


It is important to note that different customers engage with loyalty in different ways and what may appeal to one customer in terms of redemption may not to another.


It is, therefore, important to offer customers a choice as to how they engage with your programme.