License, or the Cloud, THAT is the question – Comparing technologies that drive loyalty management

The Cloud is a major driving force of the current digital revolution. There is no question about that. Providing instant access and high availability of systems and services, it has become the most refined tool, desired by companies from all industries. According to Forbes, 83% of enterprise IT infrastructure and software will be cloud-driven by the end of 2020. The Cloud is already being used for all sorts of applications – from document exchange, through financial administration, to IT infrastructure management. But the question is - is it good for loyalty management?

As ground-breaking and technologically advanced as they are, cloud-based platforms are no obvious replacements for licensed systems. The differences between the two, especially those related to customization and pricing models, might be crucial for a company's success in improving customer engagement.

Choosing a licensed LM system means that users can ask the technology provider to customize the solution to their needs. Therefore, they can determine how the process of building and running loyalty programs will look like exactly, so they can realize their customer engagement strategy as they envisioned it. Such powerful adjustments come at a price, however, as their implementation is time- and cost-intensive. Thus, an operation like that may turn out to be quite an investment.

Depending on the company's requirements, it may be very likely that a cloud-based loyalty system, provided in the SaaS model and having a specific range of functionalities, will have most of the features that the users need to drive customer loyalty. Offering a specific functional range, enhanced only by cyclical upgrades or paid extensions, as well as the possibility to parametrize the system, a cloud-based LM platform enables companies to bypass the time-consuming customization process in exchange for affordability and instant access.

Though there is more that needs to be discussed, what is important is that companies do not act on the spur of the moment. They need to review all of the pros and cons and choose a solution that meets their expectations. In the end, their clients' engagement depends on it.

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