Loyalty : the translation of information into value?

ENGLISH ABSTRACT: Loyalty programmes have become very popular over the last 10 years and manybusinesses have chosen to implement such programmes to support their marketingstrategies. Fundamental to the functioning and success of such loyalty programmesis the ability to gather, process, analyse and apply information regarding a business'customers. Such information is generated through customers' interactions with theprogramme and the business to which it is linked, as well as the various services andtheir providers that make up the programme. The aim of this research project is toinvestigate the question of whether an information-oriented strategy, based on theprinciples and paradigm of loyalty manifest in the global phenomenon of loyaltyprogrammes, can deliver value to a business adopting them.In the process of the investigation, the primacy of information as the source of valuefor any business in the new economy will be discussed. This will be transposed ontothe argument that the customer is the source of revenue generation and drives theflow of value in a business system. The results of these two streams of argument willshow how the synergy between customers and their information, through the lens ofloyalty economics, can be translated into business value with the achievement ofcore business objectives, i.e. sustainable revenue, growth, profit and competitiveadvantage. Evidence of these contentions will be provided by presenting andanalysing local and international loyalty programmes as case studies manifestingthis approach.In conclusion, the various findings of the research will be synthesised in the contextof existing, sound business, customer, and information and knowledge managementtheory to derive an information oriented model of loyalty. This model is intended tobe a strategic framework which a business can apply to provide insight into theirdecision making and assist in the achievement of their objectives.In further research beyond the limits of this paper, the model is intended to betested. In application, the validated model's purpose will be to introduce tobusinesses and their leadership the paradigm of loyalty as a strategic tool.Furthermore, the model could be used as a foundation to assist in the creation,evaluation and development of loyalty programmes and their business implicationsin practice.