Why do loyalty program rewards come with an expiration date?

Research tells us the easiest sale to make is to get your current customers to buy more; and it's less expensive to keep the customers you have than it is to get new ones.  

Loyalty programs are designed to help do this. By offering specials and rewards, they not only bring in more money and keep customers longer, they also can generate good word-of-mouth, social proof and customer referrals.

Like many people I belong to several rewards programs, one of which is Staples.  Staples has reduced their rewards significantly since I joined.  Duane Reade has too, especially since they were bought by Walgreens. 

The reduction in rewards from Duane Reade, which effectively translated into a price increase, was directly responsible for my moving most of my purchases to jet.com.

As for Staples, while I maintain my membership I have shifted many purchases to lower cost suppliers for the same reason.  But I do still recycle my ink there so I get a coupon from time to time. 

A few months ago, Staples combined two of my coupons in one email and led with the newest one.  As a result I missed the fact that the bigger coupon was expiring earlier, and had no opportunity to use it.

It may have only been for $8, but it made me mad.  I know that it's not a lot of money in the scheme of things.  But it was enough that loss aversion set in.  So a gesture that was supposed to make me feel good about being a customer instead made me angry. 

But it also made me wonder.  Why do loyalty coupons even have expiration dates?  If someone is a loyal customer why would a company care when they used their rewards, just as long as they did?

In August United Airlines announced that they would no longer impose a deadline to redeem frequent flier miles.  They join Delta and JetBlue.  But American Airlines is still requiring customers to earn or redeem miles every 18 months.  (Gazdik, 2019)

So, what do you think?  Why do companies do this?  Have you experienced the frustration of expiring rewards?  How does it make you feel about the company?  Have you shared your feelings with others?  Have you shifted your purchase patterns as a result?  Will you now favor United and Jet Blue over American?

Gazdik, T. (2019, August 29)  United Airlines Loyalty Miles Will No Longer Expire.  mediapost.com.  Retrieved October 8, 2019, from https://www.mediapost.com/publications/article/339941/united-airlines-loyalty-miles-will-no-longer-expir.html

Can you be persuaded to vacation in Key West or Puerto Rico? How?

While we continue to hear bad news coming out of Puerto Rico, the reality is that what would help them considerably is an influx of tourists.  But it may take a bit of convincing.

I wrote this blog back in March when Cape Town, South Africa was suffering from an epic drought and their tourism board served me up a few ads on my Instagram account.  Needless to say I thought it was a waste of their money.

http://pjlehrer.blogspot.com/2018/03/cape-town-is-running-out-of-water.html

But, it does beg the question as to whether people can be persuaded to visit Key West and Puerto Rico as they seek to recover. 

The Florida Keys tourism council has taken a rather standard approach, launching a ValueCation program this summer that is scheduled to run through October 21.  You can check it out here...

https://fla-keys.com/ValuCation/

Puerto Rico on the other hand has partnered with JetBlue its largest airline to unveil "Bluericua" a new plane designed by JetBlue crewmembers based in San Juan, Aguadilla and Ponce, Puerto Rico.  

According to Carla Campos, executive director of the Puerto Rico Tourism Company, they hope that the plane will generate attention and serve as a reminder of the diversity and authenticity of Puerto Rico. (Gazdik, 2018)

So what do you think of these approaches?  What persuasion techniques are they employing?  Do you think either effort will be successful?  Why or why not?  Would you have tried something different?  What and why?

Gazdik, T. (2018, September 24)  Efforts Support Tourism To Hurricane-Affected Areas.  mediapost.com.  Retrieved September 25, 2018, from https://www.mediapost.com/publications/article/325541/efforts-support-tourism-to-hurricane-affected-area.html?utm_source=newsletter&utm_medium=email&utm_content=headline&utm_campaign=111092&hashid=ybq2buULrntyGS6NfbELk0afrrI