2013 Loyalty Trends and Predictions: Where Are We Now?

Aug 22, 2013

Christmas in July is over and the Back-to-School season is in full swing. For retailers, that means the countdown to this year’s holiday retail season has already begun. While planning for the holidays may seem a bit premature when it’s still a blistering 80-plus degrees outside, I did get to thinking recently about how omnichannel loyalty is really heating up and whether the loyalty predictions we made in the run-up to last year’s holiday season are on track.

At the end of 2012, Kobie predicted that:

  1. Convergence, defined as channel coordination, would be central to consumer expectations.
  2. Big data would be the focus of brands’ efforts to engage customers.
  3. Personalization, connecting with consumers in genuine ways, would be driven by gamification and augmented reality.
  4. Smartphones would link the above three predictions. We also praised Apple’s Passbook loyalty app aggregator and iOS6.

Where are we today?

Let’s take a look at how our predictions fared and where we are 8 months later:    

1. Convergence has matured beyond marketing as many industries are learning to do more with less. That means we’ll start seeing companies handle end-to-end marketing campaigns that address customers’ communication preferences, combining internal and external offers in ways that benefit both marketers and consumers. In response to these changing marketplace needs, Kobie is building a marketing campaign management system that addresses the need for greater personalization and coordination (to be released in 2014 so stay tuned for updates).

2. Big data has gained prominence, and the discussion of what it means for marketers has also become more nuanced. As my colleague David Andreadakis, Kobie’s Vice President of Loyalty Strategy often says, big data can be viewed in two ways:

  • The amassing and analysis of massive data sets – with marketers struggling to separate data that is merely interesting from data that is actually useful.  
  • The accumulation of “small data” in large quantities – customer likes, dislikes, level of rewards program engagement, emails or push notifications opened or accepted, typical purchase price points and the channel/s employed to make such purchases.

3. Kobie was also correct about personalization and gamification – the latter predicted to be an industry worth $2.8 billion by 2016. Studies like COLLOQUY’s 2013 Loyalty Census find that while program membership is up, engagement is down. Reversing that trend requires new loyalty management tactics that make loyalty fun and also rewarding, not to mention highly personalized.

Increasingly, personalization comes down to a marketer’s access to and action on the big data subsets mentioned above. In 2013, retailers have used data to customize their loyalty program offerings to specific individuals based on their shopping and spending habits as well as on their preferred channels. There’s also been continuing efforts by supermarkets to offer individualized pricing.

In the gamification arena, whether it’s restaurant patrons voting for their favorite desserts or friends and strangers competing to accumulate the most Facebook likes for a particular retail brand, elements of game play are everywhere. Assuming gamification can be tied to key performance indicators, look for its relevance to broaden.

4. Not only have smartphones become ubiquitous, there’s growing excitement over wearable gadgets. The iWatch and Google Glass might be available by this holiday season where, once again, customer experience and engagement will be key. While it’s a little challenging to envision just how “smart” a smart watch will need to be to reinvent the wristwatch landscape, Google Glass promises to deliver augmented reality to the masses at affordable prices. The so called “Glass app” economy could again revolutionize the existing app marketplace.  

What we did get wrong, however, was the popularity of Passbook’s and Apple’s dominance – the latest IDC data shows Android phones with a 79% global market share.

Omnichannel Champions

Eight months ago omnichannel loyalty was a term still in infancy. Both a marketing mindset and loyalty program toolkit, it has become top of mind across many verticals, especially retail. An enterprise-level initiative to drive, track, measure and reward incremental behavior throughout the enterprise and customer experience, omnichannel elements are being implemented across multiple channel: A recent Smart Insights study estimated there were at least 40 such channels available. But whether marketers adopt a multichannel approach, (at least one other channel) or omnichannel depends on their specific needs and that of their customers.   

So, how did we do?  What loyalty trends have you seen emerge this since start of the year? Share your thoughts with the Kobie community below or send us an email to info@kobie.com.