REWARDS AND LOYALTY
PROGRAMMES HAVE
BEEN AROUND FOR
ABOUT 125 YEARS –
AND THE NUMBER IS
GROWING ALL THE TIME,
SAYS KATY CHANCE.
THE
CURRENT
STATE OF
LOYALTY
AFFAIRS
R
ewarding loyalty is not a new idea.
In the US, trading stamps, saved and
stuck into a booklet against which
products could be redeemed later,
were introduced in 1891. Baseball
cards – treasured and valuable
collectables to this day – started as trade cards by
a sporting-goods company even earlier than that,
in 1868, distributed in boxes of candy and tobacco
products. However, the company that really ran
with the idea of rewarding loyal customers has to
be Kellogg’s of Corn Flakes fame. Sources cite the
22
R E WA R D S & L O YA LT Y S A
Kellogg’s Funny Jungleland moving-pictures booklet
being introduced in 1909. While its delivery format
changed – from being handed over by grocers when
two boxes of cereal were purchased to a premium
mail-in offer – it was a success for a full 23 years.
According to Deon Olivier, executive director of
Tritech Media, Protea Hotels’ Prokard was the first
loyalty offering in South Africa, introduced in 1983.
“Reward and loyalty programmes originated in the
US travel industry,” says Olivier. “The first modern
frequent-flyer programme was launched by United
Airlines in 1972, followed by Texas Airlines in 1979.”
In South Africa, loyalty programmes have
mushroomed in the past two years, with more
than 100 now in existence. Most offer some reward
in the form of promotional currency, whether it’s
“miles, beans, bucks, points or stars”, says Olivier,
“which are redeemable for a growing bouquet of
products and services.”
These programmes run the full gamut of
consumer sectors and include grocery, health and
beauty, general retail (and many larger retailers
now overlap in these three categories), credit
cards, banking, insurance, medical aid, travel and
hospitality, restaurants and fast-food outlets.
According to Olivier, the total monetary value
of loyalty programmes in South Africa is hard to
pin down, but “our conservative estimates are that
no less than R20-billion a year is invested in
loyalty and customer clubs.”
OPTIONS ON THE TABLE
Most loyalty programmes in South Africa
and globally are linked to consumer spend,
which seems logical and with which members
usually have no quibble.