Building Your Loyalty Program ROI
Loyalty programs generate strong financial results by engaging guests and creating powerful incentives that encourage more frequent visits and increased spending. Before you set out to develop a loyalty program that will help you increase guest spending and visit frequency, there are several questions that need to be answered such as: What costs and revenue do I include when calculating my return? And, how do the benefits offset the program costs?
When you find the correct balance between your particular cost structure and your guest preferences, you will be able to achieve and improve upon your program's return. Understanding how you can manage the program levers, including the applicable costs and revenues, will enable you to not only sharpen your return calculation, but also, to build consensus among your internal stakeholders, while developing a financial-gain-maximizing program.
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