This episode covers the business model - Customer Loyalty as described in the book - Business Model Navigator by Oliver Gassmann, Karolin Frankenberger and Michaela Choudury https://amzn.to/2wHKa7m
In the Customer Loyalty model, customers are retained and loyalty is rewarded by providing value over and above the basic products or services (e.g. through incentive-based programmes). Here customer’s purchases are recorded and corresponding reward is calculated. The rewards take the form of either physical products or rebates on future purchases, with special offers or discounts. In this way, customers are voluntarily bound to the company, which discourages them from opting for competitors’ products and services and thus protects the company’s revenue.
Rewards earned by customer under loyalty programme encourages them to make additional purchases as rewards generally covers part of product prices. Also it enables a company to profit from sales that it would not otherwise have been able to make.
