Are You Taking Advantage Of The Skyrocketing Loyalty Market?
The increasing demand for loyalty solutions is expanding at a rapid rate across the globe, with the loyalty market set to quadruple by 2030.
Reportlinker.com has said the industry is expected to grow from US$7.6 billion in 2020 to US$27.24 billion by 2028. At present, there are 1+ billion people that belong to at least one rewards program. Actually, there’s probably a good chance you’ve got an app on your phone or a card in your digital/physical wallet that gives you access to some form of points or loyalty rewards program. And, odds are, you use it almost daily!
In fact, business priorities have shifted
Consumer expectations have changed, largely due to the chaotic COVID-19.
Now more than ever, the expectation of convenience is at the forefront of every customer’s mind, and many businesses have had to adapt to the growing demands for contactless shopping. AND numerous businesses are looking at technological innovations which personalise the remote or stay-at-home experience.
From the adoption and/or increase in capabilities of mobile payments, delivery apps, buy online and pick up in-store, to rich augmented reality experiences, loyalty programs have been established as a key player to inform the types of technological solutions needed.
Major factors that are driving the growth of the Loyalty market
Due to the increasing popularity of eCommerce and adoption of loyalty across several industry verticals, businesses are focussing their spend on the implementation or expansion of their loyalty programs to give their customers, members, or employees greater benefits.
Likely to be a driving factor of its growth, the loyalty market is not averse to the increase in omnichannel and multi-channel programs.
Unlike 20 years ago, or even just before COVID-19 changed the world, customers now have the time (and ability) to be able to shop around. With the click of a button or swipe of their mobile phone screen, switching to competitors has never been easier or more accessible – & our bank accounts are definitely feeling it!
Emotional loyalty is a key component
Coupled with personalisation, The Wise Marketer has inferred the importance of establishing a deeper connection to the customer through emotional loyalty.
Deloitte research found that emotional connections drive loyalty, with 60% of long-term customers use emotional language to describe their connection to favoured brands.
In recent times, the use of Artificial Intelligence (AI) has become a driver of innovation to target customers in a highly personalised manner. Through AI, businesses are able to harness a better understanding for their customers’ wants and needs and drive a greater emotional connection between the brands and its users.
However, one of the major focusses advocates the significance of finding the right balance between emotional and rational (or transactional) connections. However, success largely depends on collecting, interpreting, and using the relevant data to create suitable communications.
Summary & Outlook
At the rate Loyalty & Rewards is growing, the opportunities that exist for businesses is significant if harnessed.
Here are 6 Key Trends to watch for 2022:
- 5 key dimensions to meet increasing customer expectations: Experiential, Relevant, Supporting, Adaptable, Rewarding.
- COVID-19 is changing the loyalty game:
Continued growth for local, convenient, and online solutions (and thus the convergence of such factors).
- Tighter regulations:
The increase in data creation and collection require tighter regulations across all verticals (including loyalty).
- The power of data continues:
Leverage data to build personal connections and experiences.
- Rapidly changing payment landscape:
Embedded Fintech and the power of convergence.
- Technology continues to act as driver for (loyalty) innovation: Heading towards the Metaverse.