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Which is most true about loyalty programs?

A. They are basically offensive in nature; i.e., they attract new customers.
B. Over 85% of members are active in the loyalty programs they belong to.
C. They are basically defensive in nature; i.e., they won't attract many new customers but rather prevent current ones from defecting.
D. Restaurants are the number one sector for loyalty program members.
E. Most loyalty programs are profitable.

Answer :

The statement that is most true about loyalty programs is C. "They are basically defensive in nature"

A loyalty program is a marketing strategy that encourages repeat customers by giving them incentives. The incentives may include coupons, discounts, points, or other benefits.

The purpose of a loyalty program is to keep customers coming back to a particular company. It is more costly to acquire new customers than it is to keep existing ones.

Thus, loyalty programs are basically defensive in nature and they won't attract many new customers but rather prevent current ones from defecting.

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