Frequency
marketing is a promotional strategy designed to reward regular customers as
well as those who buy in large quantities. The rewards vary but may include
discounts and merchandise prizes. The main goals of a frequency promotional
program are repeat sales and customer
loyalty. There are many ways companies use frequency marketing to prompt
customers to buy more of their products.
Many
airlines offer a frequent flier program (FFP) to encourage customer loyalty.
Since many airline
companies often service the same locales, airlines with good frequency
marketing reward programs can often get a larger market share than
their competition. A frequent flier reward program usually has a name such as
OnePass for Colombia's AeroRepublica, or Punto, which means “point” in Spanish,
and is the FFP of Spain's Vueling Airlines.
Most frequent flier programs give
passengers points each time they fly with that airline. When saved up after
several flights, the points can then be exchanged for free air travel or
services. The services may include an upgrade to the first class section of the
plane or free or discounted hotel accommodation. Many airlines work together on
frequency marketing promotions with related travel businesses such as hotels,
restaurants and rental car companies.
Retail stores as well as restaurants
and department stores often give customers “scratch and win” cards as part of
their repeat sales customer reward programs. The prizes are usually free
products or a percentage saved off a future purchase. Since the cards are given
on one visit and usually can't be used until another time, the frequency rate
of customer purchases can rise as a result of this type of card program. Some
types of frequency marketing promotional cards are stamped each time the
customer makes a purchase. After a set number of purchases, the next one is
free.
Grocery chains and other retailers often use a
membership card system. Customers sign up for and receive a card they can use
to receive discounts or points to apply to free merchandise. Point catalogs
contain items that members may choose from if they save up the required points.
Since many of the larger items may take either years to save up for or require
large purchases, the company hopes to achieve customer loyalty through repeat
business.
Loyalty programs are another name for
frequency marketing promotions. The sales strategy is to keep customers buying more products to get the reward
offered in the hopes they will become long-term buyers. Companies often have to
use specific marketing strategies to help inspire customer loyalty if they have
strong competitors. The more customers keep buying their product, the greater
chance they will purchase less of the competitor's brand.