Digital technology improving loyalty programmes

As digital technology advances its impact on loyalty programmes and schemes increases, but there is still a call for more choice.

A recent study of 2,500 loyalty programme members worldwide from Collinson Latitude has revealed digital technology’s impact on loyalty programmes and schemes.

It found that over eight in ten (85%) of members prefer interacting with their favourite loyalty programme online, while 71% favour brands that are early adopters of new technology.

It is evident from this that innovative and customer-centric technology is a driver in loyalty programme adoption.

Indeed, 79% believed that the technology made their lives easier.

63% are of the opinion having a wide range of rewards and offers (including lounge access, insurance and priority boarding) is the most important aspect of a loyalty programme.

>See also: The new age of loyalty in the digital world

The need for true value of choice is critical and there is still a need for greater connectivity and the value of non-core inventory in loyalty programmes worldwide.

Commenting on the study findings, James Berry, e-commerce director, Collinson Latitude, said: “These results tell us that members crave choice and a more connected world.”

“A world where you can engage with your loyalty programme in multiple ways, be it online, or in-store, and with a range of rewards that really engages and entices your member in. Loyalty programmes no longer operate in silo, they’re part of a wider ecosystem of touchpoints between member and brand.”

Everyday spend on rewards counts

One of the most popular features of loyalty programmes for members is the ability to earn points on everyday spending.

Almost half (46%) of respondents said they like this feature about their airline loyalty programme, with a similar amount saying the same about their hotel (47%) and retail banking (52%) programmes.

>See also: Driving retail possibilities and e-commerce with data

“By allowing members to earn points on their everyday spending, you’re providing them with an incentive to use your programme – and this is something that is really resonating with consumers,” said Berry.

Burning drives earning

The study highlights the importance of striking a balance with core and non-core inventory to help maximise programme value and engagement.

The majority (64%) of respondents said that after they redeemed points or miles on non-core inventory rewards, they then went on to buy core inventory products or services with the same brand.

“Core inventory is always going to be valuable for your members because that’s why they signed up to your programme in the first place. But, by offering a wide range of different rewards and benefits, you are giving everyone a choice, appealing to your member’s personal tastes and preferences,” said Christopher Evans, director, Collinson Group.

The social engagement opportunity

The study also sheds light on how engaged different groups of members are on social media.

Programme members revealed exceptionally high levels of social media engagement in the United Arab Emirates, where 79% of respondents follow an airline loyalty programme on social media and 76% follow a hotel or retail banking and credit card loyalty programme.

>See also: How travel companies can personalise the customer journey

Whereas millennials represent the most connected generation globally, with nearly six in ten (59%) indicating that they have purchased something they saw advertised on social media.

“One of the reasons behind social media’s popularity is its ability to create and connect communities from all around the world in the one place. A loyalty programme is like a community in itself, so brands have the opportunity to create a space where its members can come together to interact,” commented JoAnn Redmon, client solutions manager, Collinson Group.

Moving forward

Digital technology gives loyalty brands more freedom and opportunity than ever before, and the study makes it clear that there are a number of ways brands can adapt their programmes to maximise member engagement.

“In order to succeed, programme managers need to utilise data to listen and adapt their offering in order to continue connecting with their members.”

>See also: A personal yet technology-driven approach to getting those 5-star

“By offering a wide range of relevant and attainable rewards and earning promotions, multiple engagement points and improving their presence on digital channels such as social media, loyalty programmes can form a long-lasting relationship with members which drives greater engagement and value for their programme,” concluded Berry.

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Nick Ismail

Nick Ismail is a former editor for Information Age (from 2018 to 2022) before moving on to become Global Head of Brand Journalism at HCLTech. He has a particular interest in smart technologies, AI and...

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