Establishing a direct line of communication between consumer packaged goods (CPG) brands and their end-consumers is critical for staying ahead of the curve. CPG loyalty programs have allowed brands to connect with their customers and glean invaluable insights into consumer purchasing behaviors and preferences.
However, the success of these programs is not solely dependent on rewards and incentives. The method chosen to engage consumers plays a crucial role in determining the overall effectiveness and impact of the loyalty program, especially in the crowded and competitive CPG landscape where establishing a direct line of communication with consumers is essential. Let’s explore different engagement methods for CPG brands and their advantages and challenges.
CPG brands can use QR codes to streamline the way to confirm purchases and distribute rewards, they present logistical challenges for manufacturers. Integrating QR codes into packaging disrupts the manufacturing process and raises concerns about fraudulent scanning. QR codes also fail to capture valuable consumer data beyond purchase confirmation, limiting their utility in understanding consumer behavior.
Manual Code Entry
Similar to QR codes, manual code entry allows consumers to redeem rewards by entering unique codes printed on packaging. While this method may deter some users, for those less accustomed to QR code technology, manual entry may offer a more accessible alternative.
Direct POS Integration
Direct integration with POS systems offers a seamless experience for consumers, eliminating the need for code entry or scanning altogether.
However, the high implementation costs and potential gaps in retailer integration pose significant challenges. Not every retailer can support POS integration, limiting its scalability and reach.
Receipt Scanning
Despite requiring more action on the part of consumers, receipt scanning stands out as the most valuable method for CPG loyalty programs. By capturing detailed purchase information, including competitor purchases, receipt scanning enables brands to gain comprehensive insights into consumer behavior. This data facilitates personalized recommendations and equips brands to adapt their offerings to fit evolving consumer preferences.
Receipt scanning empowers CPG brands to leverage competitive intelligence, understand changing tastes, and solicit valuable consumer feedback. By incentivizing receipt submission through points and rewards, brands can expand their customer base, gather user data for targeted marketing, and capitalize on upselling and cross-selling opportunities.
Maximize CPG Loyalty Program Benefits!
No matter which engagement method is chosen, CPG brands benefit immensely from implementing loyalty programs. By embracing receipt scanning as a central pillar of their strategy, brands can unlock unparalleled opportunities for consumer engagement, data-driven insights, and sustained growth in an increasingly competitive market landscape.
The Capillary team in Malaysia was excited to participate in the 2024 ReFuel APAC Forum, a two-day event uniting industry leaders for two days of networking, idea exchange, and pioneering business strategies. During the forum, our team actively engaged in insightful conversations on the state and trajectory of fuel retail.
From challenges to trends and opportunities, here are some key insights from our team on the challenges, solutions, and upcoming trends in the fuel retail market.
Current Challenges in Fuel Retail
With the rise of electric vehicles (EVs) and increased environmental awareness, there’s a shift in consumer preferences towards alternative modes of transportation. As Mobility 2.0 takes shape, characterized by interconnected, autonomous, and sustainable transportation solutions, fuel retailers must navigate the complexities of this new paradigm.
Today’s consumers demand frictionless and convenient experiences, whether it’s through online transactions or interactions at physical fuel stations. Meeting these expectations requires significant investments in technology infrastructure and comprehensive customer service training to deliver exceptional experiences across all touchpoints consistently.
Conventional fuel retailers are grappling with the daunting task of reinventing their business models to align with the evolving mobility landscape, facing hurdles in integrating new technologies, meeting shifting consumer demands, and competing with agile newcomers in the industry.
Trends & Opportunities in Fuel Retail
Electric Vehicles (EV)
The number of electric vehicles on the road today is far more than it used to be, indicating a significant mobility transition. Governments across Asia are playing a pivotal role in the increasing popularity of EVs:
Easing regulations on EVs
Offering various subsidies
Crafting supportive policies
Bolstering infrastructure development
This trend underscores a significant transition towards sustainable transportation solutions. While the adoption of battery electric vehicles (BEVs) is increasing, traditional internal combustion engine (ICE) vehicles will continue to dominate the market. Fuel retailers must innovate and elevate their offerings to capture the loyalty and spending of increasingly environmentally conscious consumers.
Non-Fuel Retail (NFR)
Non-fuel retail (NFR) covers a wide range of businesses, including convenience stores, fast-food restaurants, automotive repair and service businesses, and more. These are the go-to spots for customers looking for quick and convenient options like food and beverages, vehicle care, c-store, etc., while filling up their tanks.
Fuel retailers leverage NFR to boost their revenue and improve customer experience (CX). By providing customers with personalized offers and delivering personalized services that cater to individual preferences, NFR can play a huge role in increasing footfall in fuel stations. Embracing NFR allows fuel retailers to differentiate themselves from competitors and stand out in a crowded market, attracting customers who value convenience and additional services. Capillary’s major fuel clients have successfully harnessed the potential of NFR to drive business growth, improve customer engagement, and foster customer loyalty.
Digital Transformation
Embracing digital transformation is the key to helping shift from a vehicle-centric approach to a customer-centric approach for fuel retailers. Digital transformation can include contactless payment, digital wallets, mobile apps to locate stores, localization features, online stores, self-checkout kiosks, etc.
By embracing digital transformation, fuel retailers can gain deeper insights into their customers’ preferences and behaviors, enabling them to deliver hyper-personalized customer experiences.
Join the Fuel Retail Revolution
Using our expertise in digital-first loyalty marketing, Capillary Technologies developed a loyalty-based mobile app for one of our fuel retail clients. The results underscored digital innovation’s value and transformative potential in reshaping fuel retail loyalty and driving long-term growth.
Capillary stands at the forefront of the fuel retail revolution! We collaborate closely with industry giants to craft innovative loyalty programs that drive lasting customer engagement and loyalty. With our advanced AI-powered product suite, Capillary enhances customer experiences through personalized interactions, improved engagement strategies, and advanced loyalty solutions.
Contact us today to embark on your digital transformation journey and stay ahead in the evolving landscape of fuel retail.
It’s no secret that middle-class consumers in Vietnam have been on the rise, becoming the major purchasers in the country. In fact, according to a McKinsey report, the Vietnamese population will enter the global middle class by 2035, creating more disposable income, fueling consumption, and stimulating spending. This opens a wide range of opportunities for brands and businesses in the Vietnamese market, which is said to be one of the fastest-growing markets in Southeast Asia.
Despite all the economic disruptions affecting the world, the loyalty market in the country will continue to grow and is expected to record a CAGR of 9.8% from 2024 to 2028. Given these statistics, there could not be a better time for brands to work towards creating and building customer loyalty in Vietnam. In this article, we will dive into the changing customer behavior in Vietnam and the opportunities it presents for brands to kickstart their customer loyalty journey.
Customer Behaviour in Vietnam
Vietnam consumers have been optimistic, demanding, and discerning about their value-based purchases despite the economic challenges. They have shown an increased inclination towards spending on premium products over mid-level goods. This is apart from the core products like groceries, medicines, fuel, beauty products, etc., which are essentials in every region.
Vietnamese consumers are also showing an increased preference for non-cash payment, and if businesses do not have a digital payment system available, they will likely lose consumers.
Recently, there has been an increased dependency on smartphones and the internet among Vietnamese consumers, ushering in a new era of digital transformation in the country. A study reported that 97% of the Vietnamese population possesses a smartphone, and around 79% have internet access. These stats display the urgent need to switch from traditional loyalty programs to a more digitally enhanced loyalty program.
The report also highlighted how Vietnamese consumers are open to trying new products. This means that if brands develop more differentiated and unique products, there is a high chance of reception from Vietnamese consumers.
Loyalty Opportunities to Tap Into
Localization
Vietnam is a country rich in culture and heritage, and brands that embrace this diversity by localizing their products or services can foster a deeper connection with Vietnamese consumers. Whether it’s adapting marketing messages to resonate with local customs and traditions or offering products tailored to specific regional preferences, localization shows that a brand understands and respects the nuances of Vietnamese culture. This helps build trust and creates a sense of belonging among consumers, ultimately leading to stronger brand loyalty. One of Capillary Technologies’ Fortune 500 clients was able to better connect with their customers and win their trust emotionally by adding localization to their mobile loyalty app.
Personalization
In today’s hyper-connected world, consumers expect personalized experiences that cater to their individual needs and preferences. By leveraging data analytics and AI-driven technologies, brands can gather insights into consumer behavior and preferences, allowing them to deliver tailor-made experiences. Whether it’s recommending products based on past purchases, sending personalized offers and discounts, or addressing customers by name in communications, personalization helps build deeper relationships with Vietnamese consumers by showing that the brand understands and values its uniqueness.
Premium Services
With Vietnam’s growing economy and a rising middle class, there is an increasing demand for premium products and services. Brands that offer exclusive or premium services, such as VIP memberships, priority customer support, or luxury experiences, have a unique opportunity to tap into this affluent market segment.
By providing exceptional value and catering to the discerning tastes of Vietnamese consumers, brands can differentiate themselves from competitors and build a loyal customer base willing to invest in quality.
Omnichannel Experiences
Brands integrating their physical stores, e-commerce platforms, social media channels, and mobile apps to provide a cohesive and convenient shopping journey will stand out in the Vietnamese market. This means offering features like click-and-collect, in-store pickup for online orders, synchronized inventory across channels, and personalized online and offline recommendations.
By enhancing omnichannel experiences, brands can meet the evolving needs of Vietnamese consumers and build lasting loyalty by making shopping more convenient and enjoyable.
Digital Transformation
As mentioned, Vietnam has increasingly become dependent on digital transformation over the last few years. Whether incorporating digital wallets and payments or switching to loyalty-based apps, brands have many options to leverage this trend to drive customer engagement and retention.
Digital loyalty programs offer greater convenience and flexibility for consumers, allowing them to easily track their rewards, receive personalized offers, and engage with the brand across multiple touchpoints.
By collecting and analyzing customer data through digital channels, brands can gain deeper insights into consumer behavior and preferences, enabling them to tailor rewards and incentives effectively. Digitization also enables brands to implement gamification elements, such as points, badges, and challenges, to make the loyalty experience more interactive and engaging for Vietnamese consumers.
Social Commerce
Brands in Vietnam can harness the burgeoning growth of social commerce to bolster customer loyalty through targeted advertising, engaging content, and exclusive perks for loyalty program members. By strategically deploying targeted ads on social media platforms, brands can attract new customers and effectively engage existing ones by showcasing personalized offers and promotions.
Leveraging interactive content such as live streams tailored specifically for loyalty program members enhances their sense of exclusivity and belonging, fostering stronger relationships with the brand. Through a comprehensive approach that integrates social commerce with customer loyalty initiatives, brands can capitalize on the evolving digital landscape in Vietnam to cultivate lasting connections and drive business growth.
Trust Capillary to Grow Your Brand in Vietnam
Capillary has worked with several major brands in Vietnam and helped them scale their customer loyalty. Contact one of our loyalty experts to kickstart your journey toward long-lasting customer relationships and drive business growth!
