Evaluation of a customer loyalty strategy with system dymamics

Abstract

The customer loyalty programs are a tool of differentiation and high impact to create long term relationships with customers of a company, so as to achieve an improvement in the portfolio and collections, redu­ced costs of customer service, increased revenue from higher sales to the most profitable customers, cross selling, among many other benefits. Ac­cordingly, we present a system dynamic model to analyze the economic benefits, in terms of profitability, which would be to implement a customer loyalty strategy. To adjust and validate the proposed model, its implemen­tation is done in a real case of a marketer of agricultural products in the department of Valle del Cauca - Colombia. The simulation results show that indeed the model fulfills its purpose, and that the loyalty program achieved significant results in the finances of the organization.