Read on for the trends that are shaping customer loyalty this year. And we should know – 2020 marks our 20th year in loyalty!
Global calls for climate action are stronger than ever before and we expect forward-thinking brands to move towards ways to incentivise and reward sustainable behaviour this year. In fact, Eco-loyalty Initiative of the Year will be awarded for the first time at the Loyalty Magazine Awards 2020.
A simple act like Starbucks UK rewarding reusable cup usage shows how brands are already integrating environmentally-friendly practices into the customer experience. The question is: who will be the first major player to inspire greener behaviour with their loyalty program?
Lasting loyalty isn’t built through transactions alone. Savvy marketers know that the best way to keep customers coming back is to build an emotional connection between company and consumer. We’re seeing an increasing number of brands turn to hyper-personalisation, rewards for interactions (not just transactions) and elements that surprise and delight as a means to create emotional loyalty.
Check out the loyalty program from maternity and children’s wear retailer Noppies. Their contact strategy is totally personalised to fit the customer’s stage of motherhood or child’s age, reminding them that the brand is there for them at every step of the way.
Artificial intelligence is the only loyalty trend to make our list two years in a row. That’s because the potential of this technology within loyalty just keeps growing. AI can now personalise virtually every aspect of the customer experience. At m—wise, we’re big fans of Salesforce Marketing Cloud’s Einstein technology which can create product recommendations and emails so relevant they feel handcrafted for each customer.
Fashion retailers have been strong adopters of AI as a means to predict customers’ wants and needs in real-time. Look no further than fashion juggernaut Zalando which powers a ‘Complete your look’ feature with their Algorithmic Fashion Companion.
Experiential rewards are on the rise as companies explore ways to enhance a customer’s overall experience. It could be express shipping, an invitation to an exclusive event or a voucher for a place rather than a product. Good to know if you’re targeting younger consumers: our Disrupting loyalty: Meet Generation Z report revealed that younger customers were more interested in experiential rewards than older generations.
We believe that a strong approach is to offer customers both transactional and experiential rewards. Take the example of the Esso Extras loyalty program in the Netherlands and Belgium. Customers have the option to spend their points an anything from an online gift voucher to theme park admission tickets.
We’ve seen the steady rise of subscription-based or paid loyalty programs in recent years with Amazon Prime perhaps being the best-known example. As uncertainty over the future of retail prevails, we expect that a growing number of brands will explore the premium loyalty model as a means to secure fresh revenue streams.
Tesco, the UK’s largest supermarket chain, launched the ClubCard Plus at the end of 2019. This gives customers additional discounts and tempting perks like extra mobile data for a monthly fee of £7.99. No doubt the UK’s leading retailers will be watching very closely this year.
Retention has always been a struggle for loyalty marketers, particularly when it comes to app users. Companies are increasingly turning to gamification to keep customers engaged. We’re now seeing challenges, badges and games used as a core feature of loyalty programs.
This can truly work in any sector. Take the example of Dutch convenience store chain Primera. They knew that customers frequently stop by for lottery tickets and scratch cards. This inspired a daily scratch-to-win game that keeps users coming back to the app for a chance to win points or prizes.