Loyalty programs an ubiquitous feature of the modern economy Published-Mar 6, 2015
A brief glance inside just about any person’s wallet in a thriving economy will show at least two loyalty programmes and up to five or six.

Most large retailers and service companies have them in one form or another, from simple “get the 10th one free” cards to loyalty points systems that can grow to become exotic international holidays.

But many of them weren’t designed for the modern economy and going forward will become far less of a brand loyalty tool if companies don’t become more forward thinking about their brands and their offerings.

Companies need to be future planning for their next generation of customers; the so-called millennials whose perceptions of brands are different to those of Generation X and the Baby Boomers.

Their perceptions are largely shaped by technology-based knowledge – whether it be seeing a brand on TV or reading about it on social media – as well as interactivity with brands in online spaces and how they and their peer groups respond to that.

The fourth annual Bond Brand Loyalty Study released last year shows that today’s younger consumers have come to expect brands to offer incentive programmes.

The number spikes to 37% when it comes to millennials surveyed for the study, who said they would not be loyal to a brand that doesn’t have a strong loyalty programme.

These millennials, defined in the study as 20-to-34-year-olds, alter their purchase behaviour based on loyalty offerings, too. According to the study, 68% change when and where they make purchases to get loyalty rewards, and 60% will switch brands if incentivised.

That’s both the good news and the bad news for brands.

The good news is that it’s relatively easy to woo these consumers from your competitors. The bad news is that unless you have a loyalty programme that offers them far better incentives, your competitors will snatch them back just as quickly.

So what’s the thing that drives millennial consumers in the loyalty space? It’s not a simple answer and one we as a company will consider to be a work in progress over the next few years as technology evolves and changes consumer behaviour.

Marriott Rewards was named as one of the top 10 loyalty brands in the Bond Brand Loyalty Study on the basis that it is deemed “trustworthy”, which is critical in an era when consumers are becoming more and more concerned with protecting personal data.

“Willingness to share personal information is strongly correlated with trust,” said the report, noting that “49% of members who strongly believed a programme is trustworthy are willing to share information -- over three times the average.”

Personal data uses deemed “cool” by those surveyed included discounts based on previous purchases, customised offers and invitations to events, and “online communities” related to the loyalty programme.

Tailoring programmes to take these into account are among the pillars that will help any company maintain brand loyalty among millennial consumers

Among the innovations we’ve rolled out through the Marriott Rewards programme to capture this market segment are Plus Points, that allow members to earn points in real time through social media interactions with Marriott Rewards and Local Perks uses beacon technology to send location-based mobile marketing and offers directly to members when on property with us.

What we’ve achieved with Plus Points is to amplify our social media presence and have a two way dialogue with our Gen Y members. From their perspective, they love the instant rewards from that interaction.

Local Perks provides Gen Y travellers with much the same outcome and satisfaction as Plus Points, because it uses beacon technology to send location-based mobile special offers directly to members such as two-for-one specials that might be on offer when they walk into their hotel restaurant, and allows us to reward them based on their consumer behaviour in our properties.

The bottom line is that millennials as a consumer generation are very different to anything the retail and service world has ever seen before and they’re not going to wait for brands to catch up to them. Brand offerings have to be tailored to instant gratification to appeal to this market.

They will remain immensely loyal to brands if they believe those brands understand them, share their values, offer them unique experiences and if those brands will in turn remain loyal to them.

To stay in the game, loyalty programmes going forward will have to reflect all of those things or brands will find that they’ll steadily lose market share.

Alex Kyriakidis is President & Managing Director of Marriott International Middle East & Africa. It is the largest hospitality company on the African continent.

Sourced By: observer24.com.na

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