Kudler_Customer_Loyalty

The implementation of a customer loyalty program by Kudler Fine Foods will have both positive and negative consequences for the company and the customer alike. While rewarding customer loyalty with special benefits and discounts seems to be an excellent idea on the surface, they are fraught with ethical concerns and dangers. These programs are in heavy use by industries ranging from grocery stores to airlines. However, carelessly implementing a customer loyalty plan will lead to the company to trouble. The first of these ethical issues is, of course, privacy. Many customers won’t necessarily care that some of their information is being tracked if there is some benefit to them, some, including some of the company’s most loyal customers, will object and balk at a system designed to collect, track, and store their habits in the store. The storing and collection of this information must be outlined for the customer in the program Terms of Use in order to facilitate the securing of informed consent. All of the information gathered from customers regarding their purchases should be stored behind the most secure system available, as well. All of these things aside, who really wants to be profiled based on their supermarket purchases' The idea of it is creepy. Another ethical dilemma is the appearance of discrimination. Loyalty programs seem to discriminate against some that don’t feel comfortable joining the program. The customers that feel this way will resent having to pay higher prices for their purchases or being left out of certain benefits because they are not in the program. The store may also gain a negative image with many shoppers, as they will believe that the store is artificially inflating their prices to simply sell their goods to their loyal customers at normal prices. Also, another issue with this particular style of loyalty program is that the company is awarding services or rewards (such as an upgrade to first class on a flight) to their customers for participating in the loyalty plan and reaching a certain level within it. This could appear to be unethical to an outside viewer (Valdez, 2013). In today’s information technology world, where technology doubles every eighteen months, it is imperative that customer loyalty programs do not violate the privacy of customers or reflect badly on the store in question. However, as customer loyalty programs rely on the identifying information of the customer, and the appearance of discrimination by the store, this program will alienate many customers. The desire to reward customers is a noble one, and one that can be easily implemented without seeking identifying information. References: Valdez, A. (2013). www.ehow.com. Retrieved from http://www.ehow.com/info_8292128_ethical-concerns-loyalty-programs.html