Why Customer Loyalty Programs Can Backfire? - International Business Assessment

International Business

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................3
Article: Why Customer loyalty programs can backfire?........................................................3
CONCLUSION .............................................................................................................................11
REFERNCES:................................................................................................................................12
Books and Journals:..............................................................................................................12
Online:..................................................................................................................................13

INTRODUCTION
International management refers to a management of activities and operations in a
workplace serving markets and allocated business in more than one nation. It necessitates skills
and knowledge beyond normal way conducting business such as familiarity with domestic local
market, legal and financial environment, competitive conditions, the capability to do multi-
currency transactions and managing work cross boundaries. Managing business at international
level involves development of effective strategy, managing employees in a cross-cultural
environment and structuring an appropriate organizational design (Abou-Shouk and Soliman,
2021). Throughout such activities, organizations must tackle technical, bureaucratic, economic,
political, linguistic behavioural as well as cultural differences. Even if young ventures doesn't
pursue any global activities, a couple of global challenges may represents while competing
against as well as cooperating with a foreign organization in its own local market or easily
operations done in domestic community. The following assignment is based on the issue that is
shown up in an article of Harvard Business Review Magazine, 2021. The issue which is chosen
for this assignment is “Why Customer Loyalty Programs Can Backfire?” Customer loyalty
program refers to a marketing approach that identifies and rewards consumers who shop and
engage themselves with a brand on a recurring basis. This assignment will discuss on the
customer loyalty and customer loyalty programs that attract customers and build a strong
relationship with the brand (Albayrak and et.al., 2020).
MAIN BODY
Article: Why Customer loyalty programs can backfire?
This article is all about customer loyalty and its programs that is used by the
organizations to attract and increase its customer base. Customer loyalty programs delivers a
tremendous benefits to the business. It is understood by the article is that customers are moving
to such brands which offer perks, benefits or rewards rather simple just shop, pay and consume
the products and services (Alshamsi and et.al., 2020). It is found that customers are more likely
to engage themselves to such retailers, or visiting their official websites or store or mobile
application who offers a huge benefit to them. Also, they are likely to recommand the brand to
their families or friends.

Customer loyalty programs have exploded in popularity in now a days as organizations
look forward new methods and ways in order to keep their consumers repeatedly coming back.
Firms can turn a continuous purchase card or loyalty membership card into a powerful tool by
causing buyers to purchase with the brand and by promising a benefit or reward in turn for the
repeat shop. But, sometimes, it is seen that these loyalty programmes can backfire the company
if the customers do not touch the targets to qualify or select fir a reward are liable to keep it
against the brand and make fewer shops.
Customer loyalty is meant by the willingness of a customer to repeatedly return to a
brand to do business. This is typically because of the remarkable and delightful experiences that
have with a particular brand (Bi, 2019). One of key reasons to encourage customer loyalty is
because those consumers can support the business to grow and develop on a faster speed than its
marketing and sales can do. There are various reasons that customer loyalty is vital to success. It
is something all firms should aim by virtue of the presence. The point of beginning a for-profit
organization is to attract and hold the satisfied and happy consumers who shop the goods and
services to drive business revenue. From a workplace perspective, it is a strategy to promote
customers to repeatedly purchase from the business. There are range of various types of
customer loyalty programs such as refer-a-friend programs that provide consumer a discount if
their friend or relative signs-up or makes a shop, programs that offer free perks and benefits as
well as reward point programs.
A customer loyalty program supports a brand to develop and build powerful relationships
with the customers by rewarding them for purchasing goods or services. There are various
important advantages of having a customer loyalty program such as, customer loyalty
programmes build an emotional connection, loyalty programs encourage sakes and boost the
customer base for a life-time. On the most general level, that is completed through incentives.
The emotional connection can be built by loyalty programmes. Even so, a creative approach to
the offers made can do a lot. For instance, Nike Company, and its loyalty programmes.
Customers exploits branded app of Nike to access birthday rewards, exclusive goods and content
for customers, online workouts and offline event invitations. Customer loyalty programme by
Nike has been wildly booming (Bogdanović and et.al., 2021). It is seen that members likely
spend four times more than those customers who do not take any membership. It also helps to
reach new customers, loyal, happy and satisfied customers are one of the most strong marketing