What are the Top 10 trends in the loyalty industry?

It is widely accepted that Loyalty programs can be highly effective in driving customer behaviour and increasing customer retention. But in a changing world, how are Brand owners evolving their programs to meet the needs of their ever more sophisticated and demanding members?

To help we have put together a list of the Top 10 trends in the loyalty industry below or what our video.

Sustainability

Most loyalty programs have already realised that sustainability is a public and widely held concern and are looking at how best to reduce the carbon footprint of their loyalty programs. In the world of NFC and digital wallets who needs physical loyalty cards or gift cards or mailers through the door?

It is increasingly important to incorporate sustainability into the rewards on offer and reward delivery in particular to demonstrate a clear commitment to sustainability to members, partners, and colleagues alike.

Personalization

Most loyalty programs are increasingly trying to better reflect the needs and wants of their members by tailoring both rewards offered and communications to individual customers, rather than a one-size fits all approach.

This requires building better, deeper understanding of their members and a smarter use of technology to deliver highly targeted communications and rewards. This is going to be a major battleground with competing loyalty programs – the one that better understands the member, the better the program, the higher the level of loyalty.

Omnichannel integration

Member communications need to become less fragmented and more integrated across different channels, such as online, mobile, and at point-of-purchase to provide a seamless and ultimately more rewarding experience for members.

Explaining loyalty program benefits and promoting rewards and offers are key to a successful program. If members are not redeeming points the perceived value of the program and hence the brand will be diminished.

Collaboration with partners

It is essential that loyalty programs collaborate with non-competing brands and service providers to offer as wide a range of rewards and benefits as possible to members or participants.

As much as possible these partner-brands should have significant appeal to the demographics being targeted. Supermarkets are already common partners with many programs possible to the extent that they are becoming ubiquitous. Negotiating exclusive offers or early access to event tickets can help to boost the prestige of being a member of a program.

Gamification

Is currently a very hot topic within the Loyalty community with the gamification market projected to be worth $40 billion by 2024 according to ResearchAndMarkets.com. Loyalty programs everywhere are employing game-like elements, such as points, badges, and leaderboards, in an effort to try to make the experience more engaging.

However, just throwing gamification at the wall is unlikely to deliver. Members tend to be rapid arbiters of quality and will quickly decide whether a game is worth investing any time in or not. According to Brad Davis of Stamp Me, “As addictive as a good game is, it only works if you can get people to play it in the first place. The better your loyalty program is structured, the easier it is to gamify”.  Successful gamification tends to result from well-thought-out games that support the endeavour of the brand.

Social media integration

Many loyalty programs are seeing a major advantage in not only harnessing social media to promote the program’s benefits but also allowing members and participants to share program content with friends and family.

Integrating social media within the program platform and enabling the sharing of success in games, achievement of badges etc, and even rewards redeemed can go a long way in improving engagement and extending program reach.

Mobile technology

Ensuring that access to loyalty programs, reward redemption, and consumption where the reward is digital, is available across all devices. Members and participants do not want to have to shift device or platform to select, redeem or consume a reward.

This is particularly relevant where a reward is offered at the point of purchase or redemption. Deploying a program app quickly facilitates push notifications which can have an instant impact on behaviour.

Experiential rewards

As well as more traditional rewards like discounts, entertainment or gift cards loyalty programs are increasingly looking to extend their reward offering to experiences such as trips, events, or access to exclusive services.

While redeeming that room or flight booking why not use your reward points to book a Bateaux Mouche in Paris or a Surfing lesson in Honolulu? Offering something different and exotic can increase the perceived value significantly.

Earn & Subscription models

This area is definitely one-to-watch – earn programs are now seen as the natural evolution of traditional “burn” programs where points are redeemed (burned).

Earn programs allow users to earn loyalty points when they make a purchase on the loyalty program site Rather than a redemption) or in partner stores and sites, which in turn helps the member accumulate points and benefit from more rewards.
We see a big trend toward Subscription based loyalty programs. As a loyal customer, you can subscribe to programs such as Amazon Prime, to get a great bundle of benefits – free shipping, free content, etc.

Many companies are implementing such programs to increase interaction and engagement with their customers, but also to finance the benefits they offer and to some extent subsidize their loyalty programs.

Artificial intelligence

AI (artificial intelligence) tools are being adopted to help analyse customer data, provide deeper insight into member behaviour over time and ultimately to provide more personalized recommendations and identify which campaigns and rewards deliver the best results. Increasingly, anyone operating a loyalty program of any size will deploy AI tools to slice, dice, and filter the huge amount of data they collect as a matter of course – if they want to stay in the game.

We hope that you found our top 10 trends in the loyalty industry useful.

If you are Interested in discussing how to evolve or setup your loyalty and rewards program why not get in touch with us now?