Does utilizing a third party maximize ROI for your Loyalty Program?
I will be transparent, I am biased on this question.
Finding new ways to engage your loyalty program members and increase affinity can be a challenge. Customer expectations have changed dramatically and adoption of new technologies have expanded over the past two years creating a constant demand for innovation, personalization, and instant gratification.
Embracing new functionality for your loyalty program to meet these needs can be an expensive proposition and never one size fits all. Finding a partner who can help deliver the latest in innovation at a reasonable price while increasing interaction is not for the faint of heart.
Let me step back.
The loyalty management market is expected to grow almost 23% per year globally by 2028 to more than $18.22 Billion USD growing from $4.43 Billion in 2021. This is being driven by demand for technology solutions and customer demand as many program owners recognized the value of their loyalty programs and invested accordingly. During the pandemic these investments were an effort to increase personalization, affinity, and offset inflationary costs but above all else retain customers.
Against this backdrop, loyalty program sponsors had to take a hard look at internal resources and current tech and assess whether they could meet this new demand with what they had available. Given the increases in the loyalty management market the short answer is that they did not have the necessary tools to deliver against this opportunity but had to find the answers with third party suppliers.
I have said before that there was a time when loyalty was simply about offering more miles or discounts to program members and this was sufficient to increase acquisition and improve retention. This also translated into a relatively simple expression of technology to deliver this level of offering.
Today is different.
With regulations around privacy, shrinking margins, more competition for consumer attention and funds, personalization, more platforms to communicate, etc., the needs become more complex and the technology required is not as straightforward. Often loyalty program sponsors need more than one supplier to deliver against their vision and to create a positive experience at all stages along the customer journey. It would be a challenge for any single entity to create a technology solution that can meet all of these demands or match the pace of change to meet this demand internally.
Ultimately the solution is to create meaningful partnerships with experts that can deliver a solution that works seamlessly with existing networks and software to deliver the customer experience loyalty program sponsors envision. Finding the right partner also offers a cheaper cost alternative with greater flexibility for both large and small loyalty program managers.
Working in partnership with the right loyalty solution provider pays dividends throughout the network and can introduce customers to a whole new level of engagement delivering an optimal customer experience keeping the most profitable customers coming back again and again.
And that is rewarding for everyone.
Engage People Inc.