How the program works

[This article appeared in a supplement to Strategy sponsored by Loyalty Management Group.]All businesses depend on customers, although some relationships are not as clear as those in the air miles program.Customers get something they value. Collectors turn into valuable customers for...

[This article appeared in a supplement to Strategy sponsored by Loyalty Management Group.]

All businesses depend on customers, although some relationships are not as clear as those in the air miles program.

Customers get something they value. Collectors turn into valuable customers for the sponsoring company. Sponsors become valuable customers for Loyalty Management Group Canada.

Consumers who collect air miles want free travel. They have self-selected themselves to join the program and indicated the reward is something they want.

The bonus for sponsors is that they are communicating to a target group that wants to be communicated to.

‘We give consumers the opportunity to join a club that has a growing group of very high quality, high value businesses that share our belief that it’s important to reward loyal customers with an attractive benefit that they volunteered they want,’ says Andrew Mitchell, LMG Canada director, sponsor marketing.

‘We don’t make money unless collectors are getting air miles at sponsors,’ Mitchell says.

‘We invest in signing up collectors,’ he says. ‘It costs a significant amount to set up a collector, send them an enrollment kit, get them on the database, pay for the phone call when they call us.

‘We don’t pay back that investment unless the collector becomes a loyal customer of our sponsors.

‘Our incentives are completely aligned.’