6 Benefits of Loyalty Program and Trends in 2020
Having excellent customer loyalty programs is the best way to engage with customers, drive loyalty and reduce market churn. Despite the ephemeral nature of loyalty, a travel loyalty program will motivate your customers to buy more often and earn exciting rewards in return.
Did you know increasing customer loyalty by just 5% can boost average profits by 25 to 95% per customer?
Here are the things which we are going to study here
- 6 Benefits of a Loyalty Program
- Top Loyalty Program Trends in 2020 – How To Take Advantage
6 Benefits of Loyalty Program
1. Boost Revenue
A loyalty program is intended to boost revenue while keeping the program cost down. Stats suggest that the existing customers spend nearly 67% more than new ones. So eventually, customer loyalty programs end up paying for themselves.
2. Influences Purchase Decisions
Loyal customers shop with brands they like more often. Customer loyalty program influences their purchase decisions and about 49% of customers agree that they shop more after joining a loyalty program.
3. Deepens the Relationship with Your Brand
The customer loyalty program goes beyond transactional relationships and provides immense value to the customers which outweigh the benefit of a lower price from another brand. As the relationship deepens, customer brand recognition, emotional connection, and loyalty grow. According to Wunderman, 88% of customers want to engage with brands that meet their expectations and 74% feel that brands can do so by providing superior customer service. About 89% said that they will remain loyal to a brand that shares their values.
4. Personalization and Convenience
Personalization is an important aspect of loyalty marketing and brands can witness great purchase intent after implementing personalization strategies. About 93% of brands with advanced personalization tactics exceeded their revenue last year. Customers expect the personal touch and about 54% are willing to share their personal information for a personalized experience. This is a key in developing marketing and understanding trends to reach your users on their level and appeal to them in more ways.
Colloquy surveyed about 2,000 US consumers about the functional appeal of a loyalty program. The results indicated that personalization and convenience were the essential criteria for positive customer experience. 69% of respondents said that they will prefer a loyalty program if it allows paying for travel expenses with loyalty points. 56% of respondents said that they would use it if it offered personalization or customization of itineraries. 83% said that they prefer the ease of use while 64% said that they would love to use it if the loyalty program kept track of their travel preferences.
5. Retention and Engagement
Highly engaged customers drive strong loyalty and remain lifelong engaged with their favorite brand. Members tend to shop 90% more often while spending 60% more per transaction. Customer loyalty programs that offer exclusive travel benefits ensure that customers keep coming back for more. Offering your members a personal connection to their travel bucket lists and goals allows you to develop a deeper connection for retention and engagement purposes.
91% of customers strongly suggest omnichannel experiences as critical to developing trust with the brand. Extending your loyalty program on mobile or tablet will enrich customer experience and let them communicate how they want, wherever they want. 55% of millennials claim to be more loyal to a brand today. 65% are more likely to recommend the brand to others if it offered seamless experience and communications. About 74% will prefer to switch brands if the purchasing process is too difficult and 67% say that they are ready to pay more for a better experience.
70% of millennials, 71% of Gen Xers, 63% baby boomers and 62% of Gen Zs say that a loyalty program influences their brand choice and purchase decisions.
Everything lies in the way you create and use a loyalty program to serve your customers. You can make a lasting impression and stand out your competitors with exclusive rewards features and gamification options that create a unique loyalty program to getting more word-of-mouth for your brand.
Top Loyalty Program Trends in 2020-How To Take Advantage
There is no better time than now to take advantage of the ever so fruitful loyalty program arena. The last five years have been huge in evolution and trendsetting for the loyalty program market. We’ve looked at what’s coming down the pipeline in 2020 and have compiled a list of the key trends to keep on eye on in 2020:
1. Incentives With Co-Branded Credit Cards
Co-branded credit cards continue to dominate the loyalty market in 2020.
The incentives they offer are growing in number and quality year after year, so we recommend looking for a co-branded travel card that involves a zero to a small annual fee, resonates with your travel goals, earns you more for your travel-related purchases and gets you maximum rewards for your loyalty program purchases.
2. Welcome Bonuses
Loyalty Travel Clubs are offering sign-up bonuses and limited-time spending offers for your travel purchases. It’s best to look for a loyalty travel club that offers a welcome bonus that also helps you achieve your other travel goals. Usually, limited-time spending offers come right after you apply, so keep an eye out for that.
3. Hotel Upgrades
Hotel upgrades are the most dynamic thing offered right now. For a significant amount of value on specialty properties, you can get upgrades in the form of a complimentary stay, breakfast, free parking, spa services or redeemable points to be used on your next stay.
4. Airline Miles
This is the year to re-evaluate your mileage plan program and expand your redeemable miles by joining a loyalty club, especially for those traveling professionally. The benefits in this year’s mile redemption program include: seat upgrades, free meals, airport executive lounge access, free flights, car rentals and more.
Incentivized referrals benefit customers for simply spreading the word through referral links personally with their friends and family. Even though this trend has been around since social media first really started taking off (no pun intended) it is still one of the easiest ways to earn extra benefits and boost your point balance.
6. Reward Tiers
Reward tiers are gaining popularity among loyalty program members and are preferred by most loyalty clubs. Members can take advantage of the loyalty club’s VIP tiered offerings based on some hidden perks that reward members every time they hit the next reward tier.
With loyalty programs becoming more complex and abundant, the best you can do is to be smart about maximizing your earnings without using too much of your own money and resources in 2020.