Psychology and loyalty may appear unrelated at first, but when we explore human behaviour and motivation, the connection becomes clear. Applying psychological principles to loyalty programme design can significantly enhance outcomes for both brands and their customers.
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CollinsonCollinson released an article diving into the psychology of loyalty.
Read the article in full here.
Key takeaways:
Psychology and loyalty may appear unrelated at first, but when we explore human behaviour and motivation, the connection becomes clear. Applying psychological principles to loyalty programme design can significantly enhance outcomes for both brands and their customers.
This discussion highlights how theories from renowned psychologists can be used to build programmes that encourage and sustain loyal behaviour.
Goal Gradient Theory
Originally proposed by Clark Hull, this theory explains how people increase effort as they get closer to a goal. In loyalty programmes, tiered structures tap into this by encouraging members to strive for higher status or benefits. Once attained, members work harder to retain these privileges, helping to maintain or increase spending.
Loss Aversion
Introduced by Daniel Kahneman, this concept shows that people dislike losses more than they enjoy gains. In loyalty contexts, customers are motivated to retain benefits they already have, such as points or tier status. The fear of losing value helps drive continued engagement with the brand.
Operant Conditioning
Developed by B.F. Skinner, this theory suggests behaviour can be shaped through rewards and punishments. Loyalty programmes use this by offering consistent (fixed ratio) or unexpected (variable ratio) rewards:
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Fixed rewards, like free items after a set number of purchases, encourage repeat behaviour.
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Variable rewards, like surprise gifts, create anticipation and long-term engagement, similar to a lottery effect.
Psychology-driven Design
Effective loyalty programmes are strategically designed using behavioural science, aligning with how the mind works to motivate consistent, loyal behaviour.
Source: Collinson
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