Coalition Loyalty Program

Definition - What does Coalition Loyalty Program mean?

A coalition loyalty program is a loyalty program operated by more than one business. Coalition loyalty programs can be useful for smaller businesses that need to band together, or for certain types of purposes related to mergers and acquisitions, or anywhere that two brands stand to benefit from sharing loyal customer audiences.

Techopedia explains Coalition Loyalty Program

Coalition loyalty programs often work in similar ways. There is a collaborative approach to things like coupons and discounts, with cross-promotion across brands. Funding requirements may be split by the involved companies. These companies can also share customer data and other business intelligence throughout the enterprise partnership.

Businesses can benefit from cross-promotional traffic, where the individual brands end up promoting each other to a broader audience. For example, a collection of independent family supermarkets might decide to operate a coalition loyalty program in which their savings cards work in any of the participating stores. This helps customers to avoid the burden of getting individual loyalty cards for each one. These businesses would also typically combine their advertising efforts, to cast their "family of businesses" as having its own values and value propositions, against local competitors which would usually be larger, more established corporate grocery chains.

Coalition loyalty programs make a lot of sense in today's economy, and are supported by new kinds of technologies, such as more advanced big data handling architectures, and customer card reader setups that help to transmit valuable data into loyalty program systems.

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