New wave of loyalty in India – Digital & Data

Retailers and many other companies in India have been struggling with loyalty programmes as consumers have remained cold to the concept which was introduced a decade ago. However, the face of loyalty marketing in India is beginning to change as marketers are seeking to engender a new wave of loyalty to connect with the consumers and to delve deeper into their behaviour by moving beyond transactions to create effective and engaging interactions.


Today, the virtual world is gaining prominence and consumers prefer easy access to everything around them with ‘Just One Click Away’ approach. This has compelled many marketers to adopt digital as a new wave for loyalty marketing in India, using mobile phones and social media to connect with their member base, creating two–way active channels of communication.


Indian companies too are realising that the profile of their member base is changing with time. Once a realm of older and well-heeled patrons, exclusive loyalty clubs today are breaking down many of these barriers. Members are becoming younger, networked and more demanding. It is no longer about funneling seemingly special offers to a loyal customer, today, the consumers want to be heard and instantly gratified for their behaviour. They want programmes to be tailored encompassing their needs.


Whether it is airlines, retailers, hoteliers, financial services or other companies, all are using or switching to this emerging digital platform to drive consumer engagement. One of the leading low cost carriers (LCCs) in India has introduced their loyalty programme purely based on mobile – from checking of points to redeeming of points to receiving trigger-based communication. Beyond travel, this technology is also seeing a huge acceptability among the retailers from lifestyle to footwear to fine dining to QSR. Even the niche players like spa and salon, cafes and lounges and frozen yogurt are using mobile-based technology not only to connect with the consumers but also to drive involvement through two-way dialogue.


The increasing usage of smart phones among India’s core population is paving way for new technologies, and companies are focusing to capture this momentum by providing an enriching experience with a customised solution. Brands are driving loyalty strongly through social media where, today, consumers can earn points for tagging a location, reviews, comments, participating in polls and more.


In fact, one FMCG company in India is riding on this new medium to move beyond transactions and create more interactivity directly with consumers. The consumers enrolling for this programme can earn points for participation in polls, votes, referrals, reviews, recommendations and more which can then be redeemed for the goodie bags by the company. The company is trying to build a direct communication channel with the consumers who were majorly served by local store or modern trade.


This emerging technology is not only being limited to drive acquisition or engagement but also to increase retention of consumers through their purchase frequency. A growing multinational men’s apparel that is expanding its footprints in India is adopting mobile technology and social media to drive online purchases. They are introducing a mobile application which is integrated with social media to drive engagement and will also be utilised at POS for making purchases. They are designing a virtual apparels display application which will be tailored made to the historic purchase trend of the consumers. This will be integrated with the mobile application, so that the consumers can select and purchase via their mobile. Through this, the brand will be able to delve deeper into consumer insights and gain a better understanding of their behaviour. 


The time has come when a greater attempt is being made by many brands to understand the consumer using smart analytics, so that the promotions and discounts being offered to the consumers are relevant and can convert to purchase action. This will help to enhance their attractiveness and keep pace with the connected consumer.


A spate of irrelevant marketing emails after signing on a loyalty programme is one of the biggest complaints by consumers, like a company sending offers about motherhood products to an unmarried customer for whom it has no relevance or ability to meet a need.


So, to counter this problem, companies are employing technological tools to gather information about the consumers that includes details beyond their demographic profile like age, frequency of visit, buying patterns, item purchase to design offers and promotions that are focused and targeted and are more likely to generate a response from the consumer.


Through this growing avenue, consumers are demanding ease of accessibility. They want offers, promotions and rewards to be easily accessible to them from anywhere whether mobile, social networking or their preferred location and more. They are also looking for seamless experience across all the different channels being used to connect with them.


Real–time offers on the mobile


Today, companies want to capture the attention of consumers while they are on the shop floor to translate into faster turnaround time. Many retailers are broadcasting real-time offers, for example, when a consumer is purchasing a product, the loyalty system will analyse the information and offer him a discount, benefit or freebie on buying that product. These coupons are immediately forwarded to their mobile for a stronger call to action. 


Similarly, some apparel stores offer rewards to the consumer whenever they visit their store and tag them on social media. The system will read the information and based on their historic data will forward on the spot reward/offer on their mobile to lure them into impromptu in-store purchases.


(These are purely personal views of ICLP India general manager Mark Spicer and does not subscribe to these views)

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