With coupons, sales and discounts already expected by many loyal customers, companies have developed customer appreciation apps to further attract customers and compete more aggressively with other companies. T-Mobile Tuesdays, AM/PM scratch power and the 7/11 Rewards Loyalty Program are just some examples of companies that offer rewards for customer loyalty.

Customer loyalty apps are designed to attract new customers and strengthen the loyalty of their old ones. One technique used by many stores is a point system that rewards customers when they earn a certain amount of points. The only way to earn more points is by buying more items. When customers earn those points they earn a prize. The prizes make some customers happy that they won a free item or a discount while making others feel offended by companies’ assumptions that they can easily win new customers by offering low-quality and useless prizes.  While some may think that the creation of customer appreciation apps is a genius way of luring new customers in and keeping customers away from other competing companies, the gifts are useless and merely a heap attempt to make customers feel “appreciated.” Although these apps do not strengthen customer loyalty, it has proven to be a worthwhile investment for companies.

Since the app’s launch in July, T-Mobile  “has added two million customers, leading to a 13 percent service revenue growth,” according to Apple Insider.  Running the apps and also offering prizes — sometimes cheap and rarely luxurious — can cost companies millions of dollars. For example, the T-mobile Tuesday app offers prizes for loyal T-mobile customers every Tuesday. Offers range from a free Subway sandwich to a one-week cruise. Although a free sandwich may sound like a good offer, the specifications placed by companies are ridiculous. By requiring customers to get a specific sandwich within 24 hours of the issue date, these prizes won usually go to waste. As for the expensive prizes, the likeliness of an average person winning it is thin. One out of all the thousands of customers around the world are able to win.

To some, the creation of these apps demonstrates the appreciation of companies. However, that is subordinate to the main reason of these apps: to attract new customers. If companies really wanted to show their appreciation, they would offer prizes that are actually useful. Companies do not have to participate in these programs; however, they should change their system to something that is suitable to a higher percentage of customers. By offering discounts on their products — products which lured customers to their business in the first place — they will not only help customers and increase sales, but will strengthen customer loyalty.