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Loyalty trends and best practices

The Future of Loyalty In 2016

by Julia Leyrer
January 18, 2016
The Future of Loyalty In 2016

As we exit 2015 and reflect on the ways in which the loyalty market is continually evolving, we have compiled a list of seven main areas where we see loyalty going in 2016:

  1. “Omni-channel” will become an outdated term
    “Omni-channel” has been a buzzword in recent years, and with good reason. Consumers own an average of 3.4 devices, and brands have been able to set themselves apart by recognizing and interacting with their customers across all channels cohesively, rather than individual channels. It is already expected among customers now, and 53% cite it as important to them. If brands are still not keeping up with the omni-channel trend, they will be overshadowed by those who are.

  2. Also becoming outdated is the term “points”
    Points are becoming increasingly implicit within loyalty programs. Customers are used to seeing and hearing the word “points.” They know the concept and see it everywhere. Programs’ messages are focusing more on the actions and rewards, rather than the point process within the program. Steelers Nation Unite, a fan engagement program, is an example of implicit points within a loyalty program. As members perform activities and unlock badges within the program, they automatically receive more benefits, offers, and insider access.

  3. Members are demanding more frequent interaction opportunities
    Customers want to feel appreciated for their actions beyond purchases. It has also been shown that weekly or daily interactions build the most loyalty. Consequently, members need a range of interaction opportunities to participate in as often as they choose. Non-purchase interactions can include communication opt-ins, profile completions, social media participation, product uses, gamification, check-ins, adding items to wish lists, product reviews, and the list goes on. Brands are also increasingly adding engagement opportunities through mobile apps to add further convenience and ease of use. New Balance’s program, MyNB, even lets members earn points by exercising with their partner running app.

  4. Instant reward fulfillment is gaining significance
    Customers are already experiencing instant fulfillment elsewhere. For example, Amazon Prime Now has shipping in under 2 hours and Uber Eats and many other mobile apps deliver food in 15 minutes or less. Consumers want things “now” and this carries over into their favorite loyalty programs. Members do not want to wait a number of days until they can redeem a reward, especially if that reward can be redeemed online or in store.

  5. Not just instant rewards, but a full range of reward options is desired
    Rewards need to be more personal. Members would rather have a catalog of rewards to choose from that are relevant to them, rather than only cash rewards. In this situation, members can choose the rewards they care most about, instead of the brands hoping that the few they are offering are relevant to their entire member base. The best rewards catalogs stretch across a number of categories, such as product, experiential, and charitable.

  6. Companies are targeting generation Z as they come more into the picture
    Gen Z is coming into the spending picture more now at ages 12-17. The interesting thing about this age group is that they do not know a world without technology, mobile, and social. They are more tech-savvy and tech-demanding than the other age groups. This will advance the mobile trends we are already seeing in recent years, and cause companies to pay even closer attention to their behaviors as they define their shopping identities.

  7. Companies are demonstrating commitment to philanthropy
    Although not typically viewed as a component of loyalty programs, consumers are increasingly aware of companies’ corporate social responsibility and it influences their opinions of brands. Corporate responsibility and philanthropy are nothing new, but it is now being incorporated into loyalty programs. Programs are including their charitable actions in their messaging, and more importantly to directly impact customers, are offering charitable elements for customers to participate in. An example of this is having donations to a relevant cause as a reward option for members to choose. Even here at 500friends, our internal employee recognition rewards catalog provides opportunities to donate to charities.


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