Ashley Lightspeed knows that some business models allow for proper loyalty programs to happen easily. While others do not.
Ashley Lightspeed would say to take the example of beauty stores, for instance. Brands such as Ulta Beauty and Sephora have been running their own loyalty programs to quite some success.
Since beauty products are considered fast-moving consumer goods (FMCGs) that come with a small price tag, a single product’s sale wouldn’t really do much to support a loyalty program. That is why, these beauty stores offer programs where they encourage consumers to spend as much as possible on the goods offered in their stores.
Check out this article at Forbes.
If we take Sephora’s example, then you earn a point for each dollar you spend. These points could then be spent on a range of items that go from 50 to 100,000 loyalty points. It means that customers have to spend a significant amount of money on these FMCGs before they could move forward with redeeming any rewards in return.
But since those products are bought heavily by their loyal customers, this gives Sephora a benefit of leveraging diversity in its product offering. Someone who buys foundation would likely also buy lipstick to go with it. And those who are buying eyeshadow would go with purchasing an eyeliner as well. In summary, each product is tied to another, and this diversity and interconnectivity makes for an expensive shopping experience for anyone who visits these stores.
As a single service that doesn’t sell a range of different products but only ride hailing services, Uber doesn’t have that advantage. None of its services are tied to the other. One doesn’t have to take two rides to the same location to get the same experience, after all.
See, experts would know that this would take a bit of time or may never pay off.