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CSN PARTNER VIEWSON GLOBAL CUSTOMERLOYALTY TRENDSIN 2022
CSN Partner views on customer loyalty in 2022IntroductionThe Customer Strategy Network helps businessesthrive by solving complex customer problems.As independent loyalty practitioners and strategistswe provide businesses with a truly global customerloyalty advisory service.We offer expert, independent advice on what makescustomers loyal and most importantly how to measurethe results.Our focus is on the delivery of precision loyaltyengineering covering customer insights planning,operation and optimisation.
CSN Partner views on customer loyalty in 2022‘What the CSN experts say’Customer Loyalty is one of the most rapidly changingareas with developments in digital having a direct impacton companies and consumers alike.Partners at the Customer Strategy Network providetheir own views on the future trends for consumerengagement in 2022.We hope you will reach out to us and to our featuredexperts to share your own experiences, vision andprograms you are working on.
CSN Partner views on customer loyalty in 2022LOYALTY TRENDS COMMENTNAMEAmanda CromhoutTITLEFounder & CEOCOMPANYwww.truth.co.zaTruth operates globally butmore specifically we haveserved clients in the Africanmarketplace. We see greatdifferences between somemature markets in loyaltylike South Africa, or moreemerging loyalty marketsacross other countries inAfrica. So we have to beconscious of the differenttrends that are applicableacross the different countrieson the African continent.There are 3 main trendsthat we are seeing as thefocus for the work we do.One of them is B2B loyalty.We are seeing some reallyinteresting commercialchallenges that can beaddressed through loyaltyor incentive programmes,which range from pesticidesales in West Africa, to foodmanufacturing, throughto cosmetic brands in thepremium luxury market.Each of these vastly differentindustry verticals show asimilar approach as to howloyalty principles can addresschannel challenges, to drivedeeper B2B loyalty to brandswhich don’t necessarily havea direct relationship with theend user.Another trend we are seeingwhich has been in existencefor a long time but not reallytaken advantage of, is theability to drive engagementthrough non-transactionalrewards. For example,rewarding with pointscurrencies for uploadingcontent, reviewing products,social media engagementsand so on.And finally, which has beenmentioned by other CSNpartners, we are definitelyseeing the mergence ofpayment and loyalty todrive a much more seamlesscustomer experience forcustomers at eachtouchpoint in their loyalty/payment journey.
CSN Partner views on customer loyalty in 2022LOYALTY TRENDS COMMENTThe impact of the pandemicon business is now becomingclear. Subscription basedbusinesses weathered thepandemic better than moretraditional businesses. In2021, Sales Annual RevenueGrowth for subscriptionbased businesses increasedto 16.2% versus 12% for theS&P 500.NAMEAnita TothTITLEChief Churn CrusherCOMPANYAnita Toth Inc.One of the key elements tothe growth of subscriptionbased businesses is thefocus on Customer Success– both as a function and asa philosophy. Net RevenueRetention (NRR) is a keymetric used in subscriptionbased businesses whileEarned Growth Rate (EGR)is the metric equivalent fornon-subscription businesses.Both metrics determine howfast revenue is growing fromthe existing customer base.As the subscription-basedmodel expands intotraditional industriesand companies, the focuson retention and loyaltywill increase. Metricslike NRR and EGR willbecome common KPIs onthe retention side. Loyaltyand advocacy programscan identify new areas ofopportunity within theexisting customer base,as guided by efforts toincrease NRR/EGR.
Experts guide to consumer loyalty in 2022LOYALTY TRENDS COMMENTThe revolution occurringtoday across the customerloyalty landscape is largelydriven by the followingdisruptors:NAMEMichael T CapizziTITLEDean, The Loyalty AcademyPartner, The Wise Marketer GroupCOMPANYloyaltyacademy.orgthewisemarketer.com F irst party and zero partydata are now a must.The best way to obtainthat information, betransparent and compliantin storing, using andupdating the databaseis through a loyaltymarketing program. P ayments and loyalty arerapidly converging intoone customer focusedecosystem enhanced bymobile technologies andnew forms of currencyto reward, recognize andtransact. L oyalty has become anenterprise level initiative– Marketing, IT, Finance,Analytics, HR, Operations– all must be involved,informed and collaborative.Upskilling all of theassociates in these oncedisparate functions intoa cohesive loyalty unitwith solid foundation inprinciples and practiceswill separate tomorrow’swinners from losers.
Experts guide to consumer loyalty in 2022LOYALTY TRENDS COMMENTMike confesses to being aloyalty ‘purist’ and believesthat many global programsare not working for theconsumer or the operatordue to weak CVPs, poor orlittle use of data and a lack ofsupport at board level.NAMEMike AtkinTITLECEOCOMPANYMJA AssociatesTechnologies and Socialmedia abilities haveimproved the means bywhich program members canbe influenced with campaignsand offers but many offersare irrelevant, weak andunattainable and need tofocus more on lifestyles andlife-stages of the members.A key requirement ofthe Loyalty Industry tohelp improve programperformance is education,training and empowermentof personnel and recognitionthat ‘loyalty is a journey, nota destination’
CSN Partner views on customer loyalty in 2022LOYALTY TRENDS COMMENTNAMEMiya KnightsTITLEConsultant, PublisherCOMPANYRetailTechnology.co.ukNobody foresaw how theexplosion in consumers’pandemic-induced digitaladoption would makeknowing who your bestcustomers are imperative.I note the latest digitaltrends survey from Adobefound nearly three quarters(72%) of consumer brandssaw “unusual growth” indigital customers duringthe pandemic. But over athird (36%) also experienced“unusual churn”. This tracksin line with the rising costsof customer acquisition andpeaking interest in moreeffective cross-channelconversion and retentionstrategies that includetraditional and innovativeapproaches to loyalty.Business-to-consumer(B2C) operators must usedigitally enabled anddata-driven customerloyalty insight to drive moreeffective engagement andrevenue streams throughboth paid and, increasingly,owned channels. Mobileapps and subscriptionscombine the value of loyaltywith personalisation andconvenience, for example.But I also see ‘zero party’data sharing, blockchain andNFTs investment growth insupport of more trustworthyand effective B2B modelsand coalitions. Microservicesbased, API first, cloud-nativeSaaS and headless (MACH)architectures are emergingas a key enabler here,while I’m also closelywatching privacy-enhancingcomputational developments,such as cryptographicalgorithms, whiteboximplementations and datatrusts, to increase the reach,scale and returns on loyaltyinvestments in future.
CSN Partner views on customer loyalty in 2022LOYALTY TRENDS COMMENTOrganisations are reinventingtheir operating modelsaround consumer data; topersonalize at scale, respondin real time & continuallyreinforce a cycle of relevantcontent & experiences.NAMENick ChambersTITLEManaging DirectorCOMPANYmobileloyaltytechnologies.comI believe this will mean moreinvestment in those valueexchanges that help captureconsumer consents andthose MarTech stacks thatenable profitable changes inconsumer behaviour.New payment servicesare emerging withpersonalisation at their verycore. The permission ledapproach associated with aloyalty program will evolveto drive the adoption ofalternative payment methodssuch as one-click paymentsor cashless stores.Just as loyalty programs havebecome hidden for Brandslike Amazon, the paymentprocess will also be hiddenfrom consumers.WeChat & AliPay have shownus the way in combiningmessaging & payments.Western platforms likeWhatsApp, FB Messenger &iMessenge will follow. Brandswill need to find alternativeways to operate wheretheir customers interact.Imagine being on Instagram,seeing a picture of food andordering it for delivery onAmazon Prime or chattingwith a friend on FacebookMessenger and then leavinga tip on their restaurant foodbill. This is a ‘future’ wherecustomers look to interactwith Brands in more waysand have the ability to doso much more within theirchosen channel.
CSN Partner views on customer loyalty in 2022LOYALTY TRENDS COMMENTNAMEPaula ThomasTITLEFounder and Host of “Let’s TalkLoyalty” – the world’s first podcastfor loyalty marketing professionalsCOMPANYletstalkloyalty.comSimplicity: Feedback fromcustomers consistently showscustomers confusion with thecomplexity of loyalty programmes.As customers re-think theirpriorities through the recentpandemic, they increasing demandsimplicity, led by global brandslike Google and Netflix whovalue proposition can be clearlyunderstood, trusted and shared.Visibility: As loyalty programmeshave been used as leverage toraise capital in the airline industryin particular, the extraordinaryvalue they deliver to theirparent companies has becomeincreasingly visible and respected.Loyal customers became evenmore valuable and essential tobrands for their survival duringthe covid pandemic.Subscriptions: At times ofuncertainty, whether aneconomic recession or pandemic,consumers want to know whatthey are spending and why.They understand the value oftheir loyalty and love the ideaof benefitting more from thebrands they commit to. Thesubscription business model,when executed well, ensuresbrands can look forward to astable base of recurring revenue,and enjoy deeper relationshipswith customers over a longerperiod of time.Justification: The need to measurethe performance and prove thevalue of loyalty investmentsis a permanent “problem”.Unfortunately, many loyaltyprofessionals still claim that thehigher spend they get from loyaltyprogram members is because oftheir loyalty programmes. This isnot a view that senior leadershipteams or finance professionalstypically accept, so there is anongoing need to drive effectiveand credible evaluation of thesemarketing investments.Loyalty First: Consumers areincreasingly demand brands beloyal TO them, before they will beloyal back. Our industry has highexpectations of driving profitablecustomer behaviour changes, butconsumers increasingly ask whatthe brand is doing for them.Content: An unexpected one.Content creates loyalty. Whetherit’s youtube videos, articles,podcasts or white papers, brandsthat invest in quality content earnthe trust (and therefor loyalty) oftheir customers.
CSN Partner views on customer loyalty in 2022LOYALTY TRENDS COMMENTNAMERichard DuttonTITLEManaging DirectorCOMPANYeliaspartnership.comLoyalty marketers need toreject the notion that data,and particularly personaldata, is “the new oil”. It ismuch more valuable thanthat.Loyalty’s future opportunityis being able to increasethe value of your member’sassets as well as create anentire new asset class whichbenefits you both.The personal data of themembers of your loyaltyprogramme is an asset ownedby the member, not by yourbrand or your business.Treat member personal dataand package and protect itas you would treat wateror oxygen because, withouteither of them, your loyaltyprogramme will expire.Collaborate with yourmembers so the value of theirasset increases because ofyou, not just for you.Coalition loyalty needsto focus on connectingmembers assets with freshopportunities that increasetheir asset value.
Experts guide to consumer loyalty in 2022LOYALTY TRENDS COMMENTNAMESarah RichardsonTITLEIn 2022 Customer loyaltyis being thought of as ina significantly wider waythan it was several yearsago when loyalty teams andbudgets were purely spent onstructured loyalty programs.Now loyalty stretches acrossall marketing functions;digital, eCommerce andoperations. The area isbecoming even morecomplicated with loyaltypractitioners having to beexperts in technology, data,communications, constructsand frameworks, researchand creative.ChairCOMPANYAustralian Loyalty AssociationOrganisation need tobe investing in strategicinitiatives and the technologyto support this developmentacross blockchain as thetechnology of the futureand areas of AI that willallow for sophisticatedpersonalisation. Companiesshould also not be ignoringCryto and NFTs as rewardsto excite and stimulateloyalty members.One to one personalisationhas to finally become thenorm so that companiesstart to communicate withPeople as individuals inall their communicationswith them. Personalisationmeans that they don’t haveto trawl through irrelevantinformation. Personalisationis important from a businesperspective because itsaves money on wastedreward and communicationsand develops a far deeperunderstanding andrelationship with customer.ML and other forms of AIcan enable personalizationin a way that humans willnever be able to achieve.The sophistication oftechnology will be key to theevolution of personalisation.organisations that are trulyserious about personalizationwill need to make biginvestments in technologyin the coming years.
CSN Partner views on customer loyalty in 2022LOYALTY TRENDS COMMENTNAMEShawn TanTITLEManaging DirectorCOMPANYirewardsasia.comThe pandemic hassignificantly shiftedconsumer behaviour acrossindustries. With fast growingecommerce adoption,social media and internetpenetration, consumers caneasily compare and evaluateproducts and services.From pre-purchase search,research, purchase andpost-purchase experience,businesses need to align theirloyalty strategy to influenceconsumer behaviour acrossthese events.With the rapid pace ofdigitization, transactionalloyalty data alone is no longersufficient to accurately gaugecustomer value.Businesses need to adoptan omni-channel approachto data collection to have aholistic view of customers.Data sources such as socialmedia, surveys, reviews,e-commerce, web and mobileactivity, are essential to buildthe right insights for deepercustomer engagement.Businesses who can do thesewell, coupled with the abilityto harness the right customerdata and insights andorchestrating the right actionin the right time and channel,will have the best chanceof success.
CSN Partner views on customer loyalty in 2022LOYALTY TRENDS COMMENTNAMESimon RowlesTITLEManaging DirectorCOMPANYValue of the Australian marketgets halved and the biggestcompanies get a first partydata leadMore loyalty programslaunching and more newcapabilities deliver evergreater competitionAs GDPR stumbles internationallythe Australian regulator istightening loyalty privacylegislation including covertlyidentifying loyalty programcustomers through their creditcards. Australia paymentsregulation took 15 years to deliverthe same result the UK reached inone and halved the value of creditcard loyalty programs (which arethemselves half of all the loyaltyinvestment in Australia). FinallyOpen Banking regulation didn’tcreate the start-up challengerswe’ve seen in the UK but insteadarmed our biggest enterprisesin Woolworths, CommonwealthBank and Qantas with powerfulfirst party customer datacapabilities not seen elsewhere.More Australian enterprisesare launching new first partydata capturing loyalty programsusing more loyalty providers andplatforms than ever before. Thebiggest existing programs are allmerging payments, loyalty andshopping experiences to continuegrowing. Woolworths EverydayRewards is already the country’slargest program at 13 millionmembers but added 500,000members in the last year.www.beyonde.coTo compete loyalty programs are finding the loyalty differentiatorsbeing used by the biggest banks, retailers and airlines in Europe andthe USA and importing them to Australia. We’re seeing customerloyalty strategies that include first party data sourced through privacypreserving analytics and data trusts, NFTs as program tokens,contactless payment disappearing into contact free inside loyaltyprograms and multiple investments to build the next generationmarket wide loyalty program.
Experts guide to consumer loyalty in 2022LOYALTY TRENDS COMMENTNAMEYuping Liu-ThompkinsTITLEProfessor of Marketing andDirector of Loyalty Science LabCOMPANYLoyalty Science Lab,Old Dominion University2022 (and likely 2023)will be a year of recovery.With consumers settlinginto a more routine life,this is a time when thechoices consumers makenow will have longer lastingimplications for businesses.Loyalty will be at theforefront of that.Another trend we willsee is the need to betterunderstand and integratebrand and customer loyaltyacross channels. The digitalinnovation expedited by thepandemic has led to muchdiscussion about new modesof shopping and frictionreduction.A successful business needsto build the right loyaltymodel into its overallbusiness strategy, influencingwide-ranging areas such asproduct development, brandcommunications, journeydesign, and even hiring.To get higher-level buy-infor a more central role ofloyalty, loyalty teams need tobecome better at measuringand demonstratingthe ROI of loyalty. ThisROI measurement anddemonstration needs to beadapted to each business’sspecific situation and needsto go beyond the well-knownloyalty statistics that we haveseen frequently over the lasttwo decades.But beyond cross-channelcustomer experiencemanagement, businessesneed to better understandconsumers’ loyalty calculusacross channels. Doconsumers follow a top-downapproach or a bottom-upapproach when it comesto brand/store loyalty vs.specific channel loyalty? Theanswer is likely diverse acrossconsumers. Businesses needto identify which consumersuse what loyalty calculus andmanage their cross-channelexperiences accordingly.
CSN Partner views on customer loyalty in 2022Contact UsThe Customer Strategy Network is passionateabout customer engagement and seeks to promoteinnovation within an ever-changing marketplacethrough the collaboration of its global Partners.Speak with our Partners and share your ownexperiences by contacting them directly.www.customerstrategynetwork.com
LOYALTY TRENDS COMMENT The revolution occurring today across the customer loyalty landscape is largely driven by the following disruptors: First party and zero party data are now a must. The best way to obtain that information, be transparent and compliant in storing, using and updating the database is through a loyalty marketing program.
