Are rewards programmes keeping up with the expectations of consumers? eBucks CEO, Jolandé Duvenage, looks at key influences currently in the industry:
1. Competing in a crowded marketplace
There are currently over 70 programmes in South Africa, with 10 million South Africans carrying at least one loyalty card. We believe this growth will continue in 2013, with even more rewards programmes likely to make their debut. In 2013, we expect some existing rewards programmes to continue offering simple cashback or discount based rewards, which are earned and redeemed in a single environment, while others will focus on offering more innovative, tiered and multi-partner models. The latter often result in these companies offering significant rewards to their most valuable customers.
2. Consumers want more value
Consumers want to feel like they are in control of their finances. They shop around for good deals, and hunt for bargains, ever wary of being exploited. This new generation of ‘sharp shoppers’, make purchasing decisions based on value – resulting in increased pressure on rewards programmes to ensure that they meet this expectation.
3. Choice is the new reward
While some programmes only allow customers to spend in the same environment in which the rewards were earned, others allow members to spend their rewards across a range of goods and services, such as holidays, gadgets, gift vouchers, books and more. Members are also able to use a growing range of channels through which to spend their rewards – be it in-store with traditional retailers, online, or through mobile channels.
4. Relevant rewards drive loyalty
With so many rewards programmes on offer, consumers have more opportunities to receive something in return for their money spent. This increased competition means that rewards programmes need to ensure they differentiate themselves, yet remain relevant to their members. For a consumer to truly benefit from a rewards programme, it is crucial that they are rewarded for doing the things they do every day, such as shopping, banking and using their cellphones. It needs to be clear which behaviours they need to show in order to earn rewards. The most successful rewards programmes will therefore be the ones that customise their offerings to their members’ profiles and reward them for positive behaviour.
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