Globally, the evolution in the Fuel, Oil and Gas industry has begun. Marketers have adapted their brand and business strategies to the shifting fuel retail paradigm between drivers and forecourts.
Accelerating this change, the non-fuel retail business took the lead this year exhibiting potential in QSR, drive-through services, additional car care services, last-mile delivery, etc. Of course, the fuel sales dropped by 50 percent during 2020 but the fact that it recovered its ground soon was a welcoming sign for many fuel brands. While the tumultuous journey was a lesson learnt the hard way, new explorations were simultaneously made in the fuel retail business. As we bid goodbye to this year, let’s review the year that has been for the fuel retail sector and what charged the marketers to stay ahead in their game. Here are 5 fuel retail trends that soared high in 2021 and are all set to continue from here.
Trend #1: Accelerating forecourt experiences
By far, this is the biggest bet that many fuel brands are placing on their business and marketing strategies. It has been established post COVID-19 pandemic that forecourts are no longer seen as fuel-only stations. Fuel retailers must view them as convenience stores that sell fuel and other fuel related products. In fact, to avoid crowding supermarkets in malls during 2020, many people moved to stand-alone convenience stores like the ones at fuel stations to shop for their daily needs to practice social distancing.
Fuel retailers may try to outshine competitors by fabricating a good ambience at pumps with comfortable seating, parking lots, electric vehicle charging points, convenience stores offering a gamut of products, to modernize customer engagement. A recent study by KPMG on forecourts experience tells, ‘The total market size of the forecourts is predicted to reach $274 billion by 2029.’ It could thus be stated that fuel stations that would not include Non Fuel Retail goods might have to face a stiff competition in the market.
Trend #2: Shifting gears to alternative fuels
Government implications and early adopters had already set the stage for renewed mobility options. In one of our fuel retail blogs, we had also spoken about how aggressively companies and economies need to meet the targets set by the Paris Agreement. Stringent reforms on emissions, preference to alternative fuels like that support a sustainable environment has enabled a new era of electronic mobility across the globe. Even the advent of newer fuels (like LPG, Bio and Hydrocarbon Fuels) in some countries was a table turner for this sector that proved its valiance post pandemic. In fact the overall spike in the sales of battery-operated vehicles and plug-in hybrid electric vehicles in 2020 is a testament to the forthcoming change. Its full adoption in comparison to the conventional mode of transport, however, is still a questionable argument. Many global fuel brands are also providing premium fuel with additives to reduce emissions and increase engine efficiency, in order to move towards customization of offerings and personalization of experience, and yet targeting fuel loyalty.
Trend #3: End-to-end digitization route
Data in silos has done no good to any brand. Fuel retail is not an exception too. A single step in the digitized direction can help brands open new avenues. Moving from a card-based loyalty program to a digital mobile app is not only a convenient feature for a customer but it is also a credible piece of customer information from a brand’s perspective. The ease of digitized app is far superior than carrying a physical card. Eventually, digitization would also create a shift in consumer’s perception about mobility. The growing popularity of MaaS or Mobility-as-a-Service in a few nations is also driving the world with renewed mobility options. This broader ecosystem includes ride sharing, ride hailing, a one way or a two way vehicle sharing options allowing users to move from asset ownership to shared mobility services. Digitization could be a big enabler in helping consumers and retailers to adapt to this new trend.
Trend #4: Enabling a convenience-first model with gusto
Burgeoning consumer trends that have come forth owing to the changing lifestyles and technological advancements post pandemic are here to stay. This has enabled fuel brands to think from a convenience standpoint. The all-in-one fuel app allows consumers to not just transact and keep a tab on their vehicle’s fuel intake but has become a mandate in a contact-less world with digital payments taking the front seat. Enabling a digitized customer journey, tracking customer data to study customer needs and behavior is a pedestal to design targeted CRM campaigns. This also helps marketers and retailers focus on more up-sell and cross sell opportunities through the App. Another convenience-centric trend is the pick-up and delivery option that enables people to save on time while they fuel up their vehicle tank. This ecommerce enabled functionality is touted to come in a big way focusing on stations located at the nearest points. In the Middle East for instance, a popular fuel brand offers fuel delivery option. This could be a major game-changer especially for consumers caught up in the SOS situation.
Fuel retailers are moving into convenience and alternative retail offerings to diversify their revenue streams. Collecting the right data set and drawing meaningful insights about consumer buying preferences and behavior from it, will help upgrade the customer engagement. This data can be utilized to drive constant improvement of the loyalty program and its offerings like more customized encounters, products, services, and benefits to the consumers. Customer needs are prioritized
Trend #5: Customer loyalty takes the center stage
Although each fuel retailer could implement similar strategies, creating differentiation in this industry is a challenge. Hence fuel retailers are considering other value-added services like opting for consumer-centric loyalty programs to create a quantifiable difference. Value proposition is at the core to encourage loyalty and build brand affinity, especially in an undifferentiated product category like this. A highly motivating value-proposition will enhance consumer involvement. The value-proposition for the loyalty program should be distinctive and easy to understand for the customers. This can be enhanced by providing incentives to consumers such as personalized rewards, providing additional loyalty points which could be easily redeemed, occasional rewards like birthday wishes to make customers feel special, periodic and seasonal offers, etc. Geo-location-based rewards can be provided at nearest petrol pumps so that customers stay loyal to a fuel brand.
A well-crafted fuel loyalty program could thus prove to be a strong tool to increase brand affinity, engage customers, be on top of the mind recall and reduce customer churn. Interacting with customers at multiple touch points increases hyper-personalization and builds customer engagement. A portion of your fuel retail loyalty program configuration should be a communication strategy that guides out when and how you will communicate with your consumers. Our team of fuel retail loyalty experts have closely reviewed the market trends to create loyalty marketing strategies for some of the leading global fuel brands. Get in touch with them and drive your fuel brand sales and revenue.
47% Indian consumers remain loyal to a favorite brand even after a bad experience, reveals a study by KPMG.
Indeed, India hails with sheer loyalists – an untapped and remarkable consumer market for brands to build a strong ground for loyalty. Marketers! Read through this blog to know how you can surge your brand revenue through loyalty. We all know that COVID-19 pandemic seeded drifting consumer preferences, newer brands on the shelves and non-availability of branded products in India in 2020. In our recent report on Indian retail industry, a thorough analysis of all the post-pandemic trends raging in this industry is highlighted. The report also narrowed down how loyalty-first environment was cultivated amongst many individual brands and conglomerates as a long-term marketing strategy to retain consumer loyalty.
As much as loyalty is relevant for individual brands, it proves to be more beneficial for the multiple brands that are run under one common group. Hailing from the land of big conglomerates like BIRLAs and Reliance; Indian conglomerates must catapult this segment by tapping onto each other’s’ synergies. For instance, when travel and hotel or automotive and finance partner together, they can create one single loyalty program that would benefit both the parties during the consumer purchase lifecycle. The partnership amongst similar category brands deliver a memorable and fulfilling experience through targeted promotional offers.
Conglomerate Loyalty in India: The Big Picture
In a split second search on Google with the keyword ‘conglomerate loyalty India’ a rather inadequate result page is published. The list of articles are all dated B.C (Before COVID-19) and thus do not address the term that deserves more attention by conglomerates post-pandemic. This glaring fact further builds on the unexplored potential of loyalty in India. As we pondered, we inquired this with our sales maverick Rahul Ramachandran to offer a closer look on the conglomerate loyalty scene in India.
Industry experts have observed that conglomerate loyalty offers many benefits for its program members. However, at the same time it can be quite intricate to implement as the conglomerate has to look at each participating brand’ customer engagement strategy and accordingly enroll them for the loyalty program. It is thus crucial for brands to choose and partner with complementary brands to stay aligned in the longer run. Here is a checklist that brands must keep handy when opting for a conglomerate partnership loyalty:
- Choose the brands first that would be participating in the loyalty program
- Weigh and measure the mechanics of the participating brands in your loyalty program – get an expenses breakdown from each of them.
- Organizations need to choose between a single technology partner or multiple technology partner collaboration to enable this transformative journey.
- Identify and set aside time to market the loyalty program. This entails how many brands should be taken live in phase one and beyond, if any. It is better to create a go-live plan with the right brand mix timely.
5 Reasons Why Conglomerate Loyalty Is a Win-Win for All Brands
1. Improves overall footfall
More shopping options will eventually lead to garnering better store footfall. When different brands come together under one loyalty program, customers have more reasons to walk-in and shop. This approach definitely creates a more fulfilling and memorable shopping experience for customers as they have the option to earn and redeem points under one roof.
2. One enrollment, many benefits
Customers are often drained by enrolling through different loyalty programs during their shopping spree. As much as Indians love discounts, they also refrain sharing personal information to every individual brand. Hence, when similar brands team together under one loyalty program, it offers customers the shopping opportunity to avail more benefits from the loyalty program. For instance, Shoppers Stop offers their
3. More rewarding offers
It is always more rewarding to avail promotional offers that are more in number and rewarding as well. A classic case is that of booking a flight ticket and getting a promotional discount percentage on hotel booking using a common loyalty program. This partnership not only connects with customers at different touch points in their purchase journey but also advances further by understanding customer needs.
4. Seamless shopping journey
Customers earning and redeeming points with different brands also creates a unified profile view. The purchase history offers a peek into the customer needs that enables different brands to target promotional offers accordingly. Since customers can be easily identified through AI and other data-led technologies, the shopping journey becomes seamless and more rewarding.
5. Reduces acquisition cost
One of the most crucial benefits of venturing into a conglomerate loyalty program is the fact that it reduces the overall marketing acquisition cost. The nudging to cross-brand promotion will be lesser with one common loyalty program.
6. Plays the gamification card well
Teaming up different brands together allows myriad options to run gamified loyalty campaigns via social media channels, email and text messages, customer reviews, etc. This also assures more rewards leading to a better customer engagement strategy.
Conglomerate Loyalty in India: The Road Ahead
Shopping malls, plazas, outlet centers, airports, hypermarkets – conglomerate loyalty offers potential benefits to all the brands nestled under one group. Looking at the bigger picture, the ease of shopping experience it offers, the number of preferences the members experience in conglomerate loyalty is unimaginable. In India, The Future Group offers the option of Future Pay Wallet that allows seamless shopping experience across stores like Big Bazaar, FBB, Central, Brand Factory, Ezone, Heritage Fresh and Easyday. Another ambitious conglomerate loyalty program is India’s leading digital conglomerate who will be offering a single loyalty solution for the popular brands in its consumer portfolio. This one of its kind digital-first loyalty program will offer reward programs and benefits to all its existing and new customers. If you would like to enroll for a similar loyalty strategy, connect with our expert team to know more about conglomerate loyalty program strategy.
The challenging dynamics created by COVID-19, has destabilized the demand in oil and gas industry, along with the supply shock due to Saudi Arabia and Russia’s disagreement on production costs which has initiated a price war, further reducing the prices. This could negatively impact countries such as Iran and Venezuela, who are economically and financially dependent on oil production and export. India’s fuel consumption declined by 9.1% in the FY 2021 because of plummeted demand of around 40-60%.
Other factors like crude availability, high transportation costs, price fluctuations, government norms, etc. are beyond control, and does affect the supply chain and demand. 197 countries have signed the Paris Agreement, to curb the Greenhouse Gas Emissions by 33-35% by the year 2030. And to add to that, the current fuel retail market is largely moving from a vehicle-centric market to a customer-centric one. This radical shift is disrupted by 3 key drivers:
- Evolving Consumer Expectations: Putting forth customer convenience
- Advent of EVs: Incorporating charging stations at fuel stations is leading to advance mobility options
- Alternative Fuels: Enabling a shift towards greener fuel consumption
Fuel retail market: then and now…
The core offering of the oil and gas industry is an undifferentiated product, with similar price range, thus making it a convenience-based commodity. Customers expect a differentiated and personalized buying experience, hence fuel retailers need to invest in creating a value proposition which will know the customer, create affinity, and thus embark on a long term relationship. Businesses are implementing a customer insights platform to identify and create interlinkages. This can not only aid in consumer retention but also acquire new customers. The fuel stations in the future, would be set up to drive consumer experience and aim to build customer relationship and convenience. The evolution of Gas stations is poised at a transition that requires consumer centricity driven by analytics and multi-brand and retailing competencies to enhance their business models. Gaurav Mehta, VP and Global Head – Alliances and Analyst Relations, Capillary Technologies adds, “Market dynamics expect fuel companies to transform themselves to energy institutions and leverage the available opportunity. The desire to know and improve the consumer awareness is going to keep the fuel companies busy for the next 5 years.”
Challenges faced by marketers while designing fuel retail loyalty programs
- Disconnected consumer journeys: Fuel retail in the past has focused more on earn and burn loyalty without factoring customer journey flows. In order to build a seamless customer journey experience, it is important that brands focus more on enabling convenience than basic fuel needs. For instance, triggering push notifications though mobile loyalty programs for your customer while they are in the queue to fill their tank has higher probability of customer making a non-fuel purchase than a promotional offer which was shared a week before to the same customer.
- Meet strategic objectives: Many fuel brands step away from implementing a dedicated loyalty program. However, knowing that fuel retail is moving to customer-centric model and fuel brands can generate revenue from fuel as well as non-fuel commodities, a well-laid out loyalty program can assure higher ROI and eventually build brand loyalty over a period of time. Capillary’s Loyalty Delivered Sales (LDS) framework has the unique potential to offer up to 20% topline revenue to brands.
- Digitized offerings: Moving away from a card-based loyalty program to a digital loyalty program is the first step towards embracing digital transformation in fuel retail loyalty. It offers customer convenience by giving a varied purchase options in fuel and non-fuel commodities like selling lubricants, giving car-washing facilities, etc.
Enhancing fuel retail experience with loyalty programs
The effect of fuel loyalty programs appeared to have been evaporating as a result of the inevitable consumer shift following in the current pandemic scenario. Lesser movement of vehicles has further decelerated the fuel consumption patterns across the globe. Fuel retailers thus need to take a step back to reshape their customer strategy and attract loyalty, especially in these trying times. Emergence of new business models to induce loyalty is quite evident from following trends.
- Fueling and other services: Fuel is no longer the only commodity in the fuel retail market. Non Fuel Retail (NFR) is gaining prominence in fuel retail loyalty programs because it promises a reasonable basket value size. Convenience store purchases like ordering a cup of coffee, a tea-time snack, shopping daily grocery items; leveraging real estate for car washing, parking facilities are fast catching up in this segment.
- Increasing NFR contribution through C-store: Fuel retailers can either partner with food and product offering companies or introduce their own private labels of regularly purchased items by the consumer thereby building on their convenience store offerings.
- Treating fuel shoppers, one at a time: As the loyal consumer base differs – from a hurried driver to a group of college-goers setting out on a road trip, tiered loyalty programs offer benefits based on diverse demographics, facilitating omnichannel engagement at different touch points for different customer journeys. This also allows fuel brands to stay top of the mind as it builds a positive experience for customers.
- Leveraging digital technology: Moving to an app-based loyalty program with digital payment platforms not only assures increase in profitability but also enables customer convenience. These days, gamification features incorporated in loyalty programs assure high customer engagement.
- Other promotions – Fuel retailers are now roping in other retailers within the premise such as coffee shops or pizza outlets through cross-pollination of traffic to these outlets by offering coupons, discounts and a reason to visit again for fuel requirement or earn loyalty points if they are part of the partner eco-system.
Building fuel retail loyalty through hyper-personalized experiences
Fuel retailers have a huge potential to not only offer beyond fuel products but also create a remarkable shopping experience at their forecourts. Sushant Rabra, partner with a leading consulting firm shares his thoughts on the same, “For the fuel retailers, consumer experience is an upcoming competitive milestone. Fuel being an undifferentiated product, retailers need to come up with a strategy and opt digitalization techniques to stand out in the crowd by catering to upgraded forecourt experiences and benefits for customers.”
Since fuel is also a geo-based commodity, chances of customers returning to the same fuel brand are sometimes frugal. This is where hyper-localization has the ability to tilt the scales. With a comprehensive fuel retail loyalty program, a customer is more likely to return owing to numerous rewards offered by the brand. As brands engage and participate with their customers constantly, it builds up a credible data source encompassing behavioral patterns over a period of time and foresee customer trends. A data-driven loyalty program is the plugin that fuel retailers would need to enhance their overall customer engagement.
The revolutionary Promo Engine by Capillary for enhancing fuel retail loyalty
At Capillary Technologies, we closely reviewed the purchase behavior of a group of fuel shoppers to understand their core buying patterns over a period of time. As our experts analyzed and distilled the findings, 3 consumer traits were called out in the customer decision buying process: (a) Rewards that enable agility (b) Rewards that allow convenience (c) Rewards that offer instant gratification
Keeping these traits at the forefront, an agile framework for fuel retail loyalty was created that enables fuel shoppers to avail the next best offer on their next transaction by auto-applying coupon codes. This agile framework enable customer convenience by giving them rewards in real-time. The need to introduce this framework stems from the fact that customers have lesser time to shop, a reason why, they would prefer an automated system which can pull the next best offer based on their recent transaction as well as their past purchase behavior.
Fuel retail experience: The road ahead
Keeping these traits at the forefront, an agile framework for fuel retail loyalty was created that enables fuel shoppers to avail the next best offer on their next transaction by auto-applying coupon codes. This agile framework enable customer convenience by giving them rewards in real-time. The need to introduce this framework stems from the fact that customers have lesser time to shop, a reason why, they would prefer an automated system which can pull the next best offer based on their recent transaction as well as their past purchase behavior.
As buyer requests and patterns change, fuel retailers need to essentially change the way they perceive customer loyalty. With forecourt experiences building up from strength to strength and data-driven personalization enhancing fuel shopping experience, fuel brands must look outside the basic earn and burn model from their exiting loyalty programs. Fuel retail loyalty programs no longer restrict to rewards, but they are a potential source to shape customer behavior and gain brand advocacy. It is increasingly becoming pertinent to drive consumer retention, and drive revenue for organizations over the world. While the 2020 pandemic posed many challenges for the fuel, oil and gas companies; it also laid a path for the industry to seek newer opportunities and create a frictionless world for loyalty programs.
(The quotes provided by authors in this blog have contributed in their personal capacity. The views expressed by the authors are their own and do not reflect the views of the organizations they represent.)
The core purpose of CRM is to improve a brand’s business relationship with its customers.
CRM achieves this by analyzing a brand’s existing customer interactions throughout the purchase journey. These customer interactions are captured in one place to evaluate data and offer insights. In a market cluttered with hundreds of CRM software options, it is indeed a mammoth task to select the one that is ideal for the business. In fact, CRM is no longer considered just a software, it’s more a strategy that enables businesses manage their leads effectively and keep a track on their overall sales performance.
Today, we take a look at how marketers in Indonesia choose the right CRM technology for their businesses. Southeast Asia’s largest market by GDP, Indonesia, has embarked on its digital transformation journey. Post pandemic, Indonesia’s digital revolution is accelerating at an incredible rate. In one of CNBC’s recent interviews with Lippo Group Director, John Riady, the entrepreneur predicts, “Indonesia stands as the most exciting digital and technology market in Asia and arguably the world.” The $40 billion e-commerce market in Indonesia has been pushed by the work-from-home culture and businesses’ cautious shift to sell online. Add to this, the introduction of digital payments and advanced technology tools like AR, VR, AI, ML, chatbots, etc. has further enhanced the consumer interaction journeys. Clearly, the need for a robust CRM is evident in this region.
We chatted with one of our ace Indonesian CRM experts to understand the mindset of marketers in the region. Here is a detailed download of our conversation.
Top 3 things that matter the most to Indonesian marketers when choosing CRM
- Seamless integration: Indonesian marketers look for a CRM that requires least integration effort with their current database. Lot of them fear the strenuous integration process it may require.
- Cost-effective: One cannot deny that pricing is one of the most important considerations for marketers when selecting a CRM system. Given that many new and upcoming businesses have established in Indonesia recently, a cost-effective CRM solution is crucial to them.
- Local presence & understanding: A country as populous as Indonesia has a more diverse demographic structure and base. Upcoming businesses are still learning the ins and outs of CRM technology. As a result, they are more likely to give preference to CRM system companies that are situated in Indonesia. This gives them the flexibility to contact customer service at Indonesia local time, if there are any unanticipated technological issues.
While the aforementioned factors are non-negotiable for them, marketers must also consider other crucial factors that are often unconsciously missed out when selecting CRM technology for their business.
Presenting 5 CRM capabilities that Indonesian marketers just can’t ignore
1. Capturing non-transactional data to record NPS
One of the stumbling blocks in the Indonesian market is generating complete awareness about the potential of CRM technology. Brands must be aware of promoters and detractors’ activities. More than capturing transactional data, CRM captures non-transaction data that can be used to engage with customers. For instance, Net Promoter Score (NPS) data defines which customers are promoters and detractors based on their feedback to brands’ products and services. Hence, with this information, brands can engage with customers in a different way. The fact that digital transformation is fast catching up in Indonesia, brands need to understand that CRM offers actionable insights to improve overall business performance by evaluating customer behavior at different digital touch points.
Bata in Indonesia had chunks of unutilized data when they decided to partner with Capillary to capture customer’s feedback data through NPS. By enabling QR code scanning at the counter, customers submitted feedback which helped brand to map their customers better.
2. Enabling 1:1 personalization through customer segmentation
We all know that by tracking the transaction history of customers, CRM can trigger effective promotion campaigns. But what marks the differentiating factor here is tracking the accurate and right set of data as per brand goals. Take for instance, Dominos in Indonesia who wanted to increase their online order value through the brand’s own online channel besides other food ordering aggregators in the region. By enabling Capillary’s CRM , the data captured customers’ pizza preferences like crust, toppings, etc. the brand rolled out personalized promotional offers for specific customer groups thereby increasing their overall purchase propensity. This also encouraged customers to order through brand’s own online channel than other available digital channels. Over a period of time, this promotional activity built a higher engagement rate between the brand and the customer.
3. The indispensable omnichannel integration
The core of CRM is how it molds itself in the omnichannel retail world. Marketers must not look at CRM software from a one-dimensional view. Given the fact that customer behavior is always changing in today’s environment, CRM software must incorporate empathy into client interactions across several channels within a single customer journey. Although the quick integration procedure is a fair issue expressed by Indonesian marketers, omnichannel messaging integration in the CRM is now the need of the hour.
Capillary’s expertise in integrating with multiple systems like POS, ecommerce platforms, central database and social channels (like FB, IG, LINE, WhatsApp, WeChat)demonstrates how it can bring an omnichannel experience in achieving a brand’s goals.
4. A scalable CRM can support rapid growth
Many new enterprises are springing up in Indonesia, and some of them are overlooking the importance of scalability when selecting a CRM. Purchasing CRM software should not be viewed as an additional expenditure. Rather, it is more an investment towards business growth. As the company grows, its needs expand; and only a scalable CRM platform will be able to handle the load.
5. Effective management of first-party data
In order to derive the most value from their consumer data, marketers must assess its usability and scalability. Although the contact management feature in CRM enables data collection, but just having data stacks in a CRM software will never do justice to a brand. Only by democratizing data, can actionable insights be developed, allowing retail tech businesses to contribute real-time value to their customers’ lives.
An agile and robust CRM is the strongest lever to grow and align a brand’s marketing, sales and customer service objectives. The next time you purchase CRM software for your business, ensure that you understand and align your company objectives with the right capabilities offered by CRM. To understand the comprehensive benefits offered by CRM, book a demo with our experts today.
Moving over earn and burn, personalization has now become hygiene. In a world where dynamic consumer behavior has become the game changer for brands to set their marketing strategy, gamification might just be the secret ingredient that Indian brands should watch out for next.
Coined in 2003, gamification is in its full form these days. While in some countries, the concept of gamification is as amateur as it can be, in the last few years, gamification has moved beyond badges, challenges and leaderboards. Innovation has been done in this space by some of the leading brands like Nike’s running app, Starbucks, Duolingo to name a few. Most brands, however, are still oblivious of its engagement power. This scenario is more evident in the Indian subcontinent. Is it because of the lack of interest or are marketers unable to foresee the true potential of a gamification strategy in loyalty program? Or was it Google Play Store’s restricted guidelines on gamified loyalty programs in India last year that refrained brands from indulging in gamification? To some extent, yes.
If we go back to basics, winning and losing are part of a game. Could that be the reason why brands withdraw from the gamification strategy? As only a handful of members would win. Would this lead to a disappointing factor among their existing loyal members? The answer is ‘No’. In fact, lack of engagement might lead otherwise. Indeed, all games come to an end but one cannot debate the irresistible engagement and excitement that a game can build in a loyalty program. A loyalty program needs to execute the gamification strategy to keep their existing loyalty program engaging with customers in a fun and interactive way.
3 ways gamification strategy in loyalty programs is sure to hit the jackpot
It is disheartening to learn that 54% loyalty memberships are inactive. Knowing what a customer really wants from a brand is an ever evolving thesis in itself. A gamification strategy would make a difference when the games integrated with a loyalty program can engage their customers like no one’s looking. It is thus vital for brands to segment their customer groups, analyze their shopping behavior and draw clear insights on how gamification loyalty will hit the bull’s eye for their loyal consumers in the longer run. Gamification in loyalty programs however, instantly meets two of the most crucial and primary objectives of any brand. These are stated below:
1. Turning on active mode for inactive customers: Of all the customer segments, managing the inactive group is the most challenging one. While it also depends on what product or service a brand is selling but having no customer interaction for a long period might result in a dropout soon, if not addressed timely. Given that 65% of a company’s revenue comes from its existing customer groups, it’s hard to let go off customers based on inactivity. At a time like this, gamification in loyalty programs disables inactivity and brings customers a step closer to interact with the brands through introducing gamification features like Spin the wheel, Prize machines, Quizzes, etc. Designing an exclusive gamified loyalty program would largely depend on what your customer aspirations and motivations are. At Capillary, we dive into data-driven insights to create the right gamification strategy for your loyalty programs. Learn all about gamification in loyalty programs here.
2. Building customer engagement: All said and done, games are an excellent mode of customer engagement. In fact, NY best-selling author Charles Duhigg aptly shares how everyday small wins lead to a contended life. In his blog on the Economics of Small Wins, he shares, “Small wins fuel transformative changes by leveraging tiny advantages into patterns that convince people that bigger achievements are within reach.” When you consistently build a relationship with your customer, you would notice the spike in the brand ROI as part of the repeat purchase pattern indicated by your customers result in increased website traffic, frequent revisits and higher customer engagement. And consistent and successful customer engagement can drive 55% higher share of wallet.
3. Swinging up ROI: With a surge in customer engagement and the right gamification strategy in place, a business’ ROI is bound to be positively impacted from a well-laid out gamified loyalty program. Clothing brand Moosejaw noticed a whopping 560% ROI after incorporating gamification strategy.
3 super brands leading the race with gamified loyalty programs in India
After having relaxed its Play Store policies early this year, Google too aligned with Indian conglomerates and startups for the need to build customer engagement through gamification more than ever before. In India, brands are still opening up to the notion of gamification but following are some of the players who have brilliantly executed this strategy in their loyalty programs.
A subscription-based model with an upfront one-time annual fee offers countless benefits (at preferential pricing) to its members. This loyalty program need no introduction. But if you think that offering rewards is the only pull for its loyal customer base. Think again. Login to your Amazon Pay App and unveil some of the most exciting games that members can play, earn, redeem and play gain. They also tie up with new product launches and build exclusive games around such events. If you are someone who has already played some of these games, you would agree that gamification puts you in a recurring loop for at least 15-30 days taking customer engagement to an altogether new level.
It comes as no surprise when cricket and India are teamed together for any marketing campaign. Swiggy’s Match Day Mania in 2020 was one such loyalty program with gamification strategy that was centered around nation’s most loved game and received highest traction during the time it was run. Swiggy ran a Cricket Quiz Flow option that let users guess the correct answer and win perks simultaneously. This was followed by #InItToWinIt – a raffle campaign aimed towards ordering from Swiggy and moving closer to win exciting gifts. Valid on weekends, this was an interesting way to engage the audience given the pandemic had already created a lull and reluctance to step outside to dine.
Besides seasonal games, currently, Swiggy has a roulette-based game for its subscribed members that allows them to pull the lever and things roll up as rewards after availing a certain number of food deliveries the subscription.
Ecommerce player Flipkart too introduced SuperCoins zone that allows its members to play different games and earn rewards simultaneously. A user earn coins on every purchase they make and earn rewards simultaneously. The brand also has an exclusive Gamezone that enlists some of the most engaging games keeping in sync the Indian consumer behavior and motivations. Recently, Flipkart introduced a daily trivia Bollywood quiz under its games section in the App comprising five questions to be answered before midnight. Many prizes and SuperCoins are up for grabs thereby increasing the probability of winning for its subscribed members.
A gamified future…
An industry that is valued at $12 billion and is touted to grow enormously, gamification market is expected to hit $31 billion by 2025. These tap and play games in loyalty programs have enabled consumers to feel positive given the current unstableness hovering around the world. Consumers feel involved with a brand, motivated and look towards a sense of achievement when they win badges or are recognized on social media platforms. Given the motivational level it creates, consumers are drawn to visit the App, store, website or any other platform again thereby creating higher level of gratification which in turn works favorably towards the brand.
Indian brands like Swiggy, Zomato, Amazon have leapfrogged and are reaping its benefits. It’s about time that gamification strategy in loyalty programs takes the lead in India and brands incorporate this strategy for achieving a higher engagement.
What was that one thing that most brands focused most during last year?
Indeed, it has come a long way. In the world of retail, loyalty was often considered as an underdog. The broadcast commercials, promotional offers and print advertisements ruled the roost. Cut to the millennial century, brand promotions continued but marketing honchos worldwide realized that it is time to hold on to their existing customers, their loyal brigade. Marketers worldwide are waking up to the myriad benefits of a loyalty program, there are some Superbrands who found their way to the buyer’s heart. While offering customer loyalty programs consistently, these companies gradually formed brand advocates like no one’s watching. So, let’s take a closer look at brands who got it right, really right with their loyalty programs that their customers swear by the products and services offered by them.
Talk about brand loyalty in any part of the world and Apple tops the list. On 16th March 2021, it was noted that Apple’s brand loyalty reached an all-time high of 92% in comparison to 90.5% in 2019. While they bank largely on product innovation, what works for them is their products and services are conceived from the customer insights they capture. One of the 2019 surveys revealed that 90% of iPhone users look out for next iPhone as an upgrade or buying option. And that is some loyal community to be proud of!
When it comes to buying nearly anything online, Amazon really heard its customers. Given the pandemic paralyzed the world last year, Amazon’s delivery options were highly valued. The brand has come a long way to embrace the ideology, ‘customer is the king.’ Their new membership plan, Amazon Prime not only offers free and timely shipping but special offers, entertainment options, ad-free music, that customers can blindly rely on.
Heard about the IKEA Effect? The psychological phenomenon is derived from the adulation Americans had towards their self-assembled furniture. In short, feeling joyful for an otherwise frustrating experience. From an American brand to a global furniture name, this brand too puts customer needs first to design their products accordingly. This brand brought a cultural change in people’s minds and its customers are definitely not complaining.
In the 2019 retail loyalty report by InMarket, it was revealed that Walmart topped the list given its consistent customer engagement initiatives. Over the years, this multinational entity takes brand loyalty seriously by adopting digital strategies and expanding on their offering. Another notion that Walmart believes in that brand loyalty is not restricted to just the products they offer but to the larger audience they cater to.
Come to think of it, it’s just a cup of coffee? Knowing that a Starbucks coffee would cost you much more than coffee at a regular café. But ask a Starbucks rewards program member and they’ll tell you it’s beyond that. Their ‘order and pay’ feature on the mobile app allows customers convenience, pairing suggestions, free refills, discounts and earn stars for every transaction they make. More stars, more rewards – it’s that simple and effective.
There are some brands that are built on their product innovations, some like NIKE are built on their messaging, their brand image. NIKE has done that! It doesn’t matter whether you are a sport-fanatic or not, this footwear brand adds personality to their consumer wardrobe by offering ability to customize color options on its website. You wear them like you own them and never to ditch them.
The beauty marketplace is as huge as it is competitive. So while other brands would vie for consumer attention, Sephora packs it all under one roof which works as their biggest USP. It caters to delighting customers by giving them a one-stop shop experience. They don’t pause there, in fact, their much-acclaimed and loved tiered loyalty program offers its members invite to exclusive events, favourite brand offers, birthday specials and countless freebies on point accumulation.
It’s not just any athleisure brand but it’s a brand with a purpose. And their loyal consumers are well-aware of that. The driver and promoter of healthy living and mindfulness, this is a proud parent of over 1400 ambassadors who speak for their brand across the globe. Organizing free fitness sessions and festivals, Lululemon is indeed an inspiration for its customers educating them living a good life.
According to the Brand Keys Annual Loyalty study of 2020, Dominos climbed up ten spots to reach the fifth position leading the pizza category in customer engagement and loyalty index. Launching their loyalty program in 2015, the brand offers new and varied pizza options to different customer segments based on their purchasing behavior. The brand has witnessed a definitive increase in its loyal customer base and overall purchase frequency.
This carbonated drink pretty much taste the same like its competitors but for its loyal customers it does taste different. With over 50 million Facebook fans across the globe, there is something definitely that they did right, from time to time. Building a SuperBrand image and retaining it for long, it is not the sheer promotions that makes this drink grab the top shelf in stores today, but its loyal fan base.
Rome was not built in a day, neither can be brand loyalty. When you venture the loyalty program path, remember: Customer loyalty is offered, Brand loyalty is earned. So, focus wisely. If you haven’t tread that path yet, take a step forward and talk to our loyalty experts who will build one exclusively for your brand.
We are about halfway into 2021.
For most of us, this year too seems like a reflection of last year. The Lion City is not an exception too. Of course, the changes that pandemic has brought were inevitable and Singaporeans are now adapting to the post-pandemic habits. It was noted that last year 31% of Singaporeans actually shopped online for the first time during the pandemic! The same study also predicts that even when the pandemic ends, half of Singaporeans would prefer shopping from large online marketplaces. This sudden surge in ecommerce shopping activities have brought a twist to the current retail arena in Singapore.
Retailers and marketers are thus focusing more on creating a loyal customer base. Combating the sky-rocketing shop rental costs and reduced store footfall, loyalty programs could be the hook retailers are looking at. The importance of having an omnichannel loyalty program has gained more momentum than ever. A report by FIS (payment software) claims that 81% of Singaporeans prefer shopping with the retailer who has a loyalty program. Sadly, 48% of Singaporeans feel that they have very limited engagement with the loyalty programs. So before we distill the fine practices of a loyalty program, let’s take a closer look at some of the top loyalty programs in Singapore that have been there and done that, and that too exceptionally well.
1. The GrabRewards – Cashless First, Loyalty Program
Leading with the changing environment around is Grab Rewards. A leading public infrastructure provider, Grab is now home to the popular App offering hyper local services as well. Their loyalty program has gain more precedence in the last year owing to its consistent intent and endeavor of promoting cashless, contactless payments by offering more rewards. They have a 4-tiered membership where the members can climb from Member to Silver to Gold and finally Platinum by adding more points. As they have introduced GrabPay Wallet as the mode of payment, it allows its members to earn more points through the same tier benefits if they pay through Grab wallet. The best part is its point expiration policy. As long as you make 1 Grab cashless transaction within the next 6 months of your last transaction, your points will continue to accumulate.
2. TungLokFirst – Instant Gratification Loyalty Program
With over 35 restaurants across Asia, the TungLok Group is a delight for the Singaporean diners offering both traditional Chinese fare as well as the Modern Chinese cuisine in Singapore. TungLokFirst, their loyalty program enables multiple touch points by offering members to redeem their points across different restaurants under the group. It provides personalized offers, vouchers, discounts and other delectable privileges to extend an unparalleled dining experience to its loyal customers. Besides new sign-up bonus, online sign-up bonus, birthday month special offers; members can also get more rebate during non-peak hours from Monday to Thursday on a-la-carte orders and set menus. One of the unique privileges that its members can avail is the dynamic rebates on their bill instantly.
3. CapitaStar – 24/7 Loyalty Program
Hailed as Singapore’s leading lifestyle and shopping rewards program, CapitaStar is a 24/7 app-based loyalty program that offers members to spend across CapitaLand Malls, eCapitaMall and Capita3Eats. Part of the CapitaLand Rewards program, members earn stars and rewards for every transaction they make in the above outlets. This multi-store cardless rewards program is also available in China and Malaysia besides Singapore. With over 1.1 million members, this program has no membership fee or expiry date. It also offers additional rewards for the birthday month as well as event invitations and promotions to its exclusive member-only events at the participating CapitaLand Mall. It issues a car parking e-voucher that could be used with all the participating CapitaLand malls.
4. NTUC FairPrice Group’s Plus – Coalition Loyalty Program
Introduced by the NTUC Link Private Limited, Plus is Singapore’s most popular coalition loyalty program. With a member count touching 2.3 million, it partners with 1000 outlets and allows members to earn LinkPoints which can be earned online as well as in-store purchase. These points can be redeemed for instant savings or exchanging points. In 2020, NTUC collaborated with Kopitiam and NTUC Foodfare to form FairPrice Group. Created for its members, the Plus App offers a feature – Stamp Your Way which allows members to check-in every time they visit a store and collect a reward on completing a certain number of visits. Members can also review their LinkPoints as they shop with different brands in one single-view.
5. Healthy 365 – Health First, Loyalty Program
Spearheaded by the Ministry of Health and Health Promotion Board Singapore, this app-based loyalty program aims to inculcate healthy living habits. Given the pandemic has further highlighted the importance of health and immunity, this app is gaining traction amongst Singaporeans these days. Users can maintain a log of routine activity like counting the total number of steps per day, exercising time, etc. It also offers a wide array of health articles, go-to health directory of the region and interesting challenges. When a user signup for these health programs and challenges, they earn Health points which can be redeemed to purchase healthier food options, groceries and drinks.
The Future of Loyalty Programs in Singapore
As Singaporeans stay merry with the freebies attached to the loyalty programs, a recent survey states that non-expiring points, cashbacks and rewards with multiple retailers have proven to be the sure-shot way to encourage members to sign up for a new loyalty program. With new innovations like- Friends and Family (group loyalty) and partner programs making inroads; it’s time brands rethink their loyalty strategy and implement the right mix suited to their loyal customer needs.
Echoing the spirit of togetherness, the holy month of Ramadan is a time well-spent with family and friends. If the last year saw people stocking up during this month as a result of panic-buying, this year, people are equipped to observe the holy month amidst the pandemic. Given the vaccination roll out has kick-started in some countries but the ongoing pandemic-related restrictions continue, the festivities are somewhat affected in the Middle Eastern region. While this time always pose a great opportunity for businesses to see a significant jump in their revenue, marketers have now found their new retail normal.
Last year, Ramadan gave rise to customer trends that shifted marketer’s focus to a new customer engagement platform that could enhance the experience of a brand’s customers. Let’s take a look at these trends and see how personalized customer engagement is now the quintessential ingredient for every marketer in the Middle East during Ramadan 2021.
1. Go Digital
Togetherness – the spirit of Ramadan led people to stay connected despite the pandemic restrictions imposed all across. In 2020, world’s largest gathering to break open the fast was organized online. This online event secured a place at the Guinness Book of World Records and gave rise to a new digital audience. Brands accordingly designed their new Ramadan marketing campaign strategy. Here are some numbers that further enabled marketers to tweak the demographics of their audience. In their recent report – ‘Ramadan: This is the Joy of Discovery’ Facebook shared some interesting insights on media consumption habits of people in the Middle East.
A look at UAE’s preferred media choices
A look at Saudi Arabia’s preferred media choices
Almost 44% people in UAE and 42% in Saudi Arabia spend time on their mobile device during the holy month of Ramadan.
An equally interesting highlight is that Whatsapp is the preferred choice over other social media channels with 39% people in Saudi Arabia and 42% in UAE opting for it.
This trend clearly emphasize on why marketers need to relook at their Ramadan marketing campaigns.
2. Online Shopping
While it’s debatable and still a far calling whether physical store visit could completely replace the online shopping model but this Ramadan, digital audience undoubtedly gave rise to online shopping. A Survey by checkout.com (leading global payment solutions provider) tells us that 95% of Saudi Arabia and UAE residents are preferring online shopping. This is expected to grow further during Ramadan 2021. The report also indicated that this isn’t a short-term strategy but a long-term customer behavioral pattern that has resulted from the trends post Covid-19 pandemic. Now, let’s look at the expected purchases that consumers are likely to make during Ramadan 2021:
Most-shopped categories expected during Ramadan 2021
3. Personalized Customer Engagement is the key
With digital avenues opened up and online shopping becoming a rage, this Ramadan, retailers in the Middle East are focusing on building smarter marketing strategies without disrupting their brand value while catering to consumer’s shifting behavior pattern at the same time. A startling fact that emerged here was 68% Saudi viewers watch more advertisements of their favorite brands that focused on relevant messaging. Consumers are more responsive to brands that exhibit personalized shopping experience.
Personalized messaging using robust customer engagement tool
Choosing appropriate content to build Ramadan marketing campaigns is as important as selecting the medium used to deliver it. In an age where mobile is the device and direct messaging, WhatsApp communication is taking the plunge, brands are opting for personalized customization across all channels to build more engaged audience. With emerging automated marketing tools offering features like time personalization, brands can send out relevant communication, at appropriate times during Ramadan and share relevant communication with people. A personalized customer engagement tool can deliver desired outcome from a brand’s Ramadan marketing campaign.
4. Building Customer Advocacy
During the month of Ramadan, consumers would like to see brands who held themselves accountable for the marketing campaigns themed around being sensitive to the world outside and consistently care for their customers. A reason why marketers would like to engage better with their loyal customers by curating unique experiences. This is a great time to build customer loyalty and exhibit your brand value in a new light. Given the trends tipping towards digitization, a detailed mobile loyalty program could be one of the many strategies that a brand can eventually build with their audience to establish customer advocacy with the brand.
Brands building customer advocacy using loyalty programs
Ramadan 2021 offers this year…
Brands far and wide are staying connected with their consumers during Ramadan by building interesting marketing promotions like Instant gifting for high-spending customers, Gamification, free deliveries with no-cost exchanges, allowing customers to donate their loyalty points for charity, etc. Capillary Technologies powers 100+ such marketing promotions including the likes of RedTag, Bata, Malabar Gold & Diamonds among others enabling brands to deliver compelling customer experience. Take for instance, Red Tag who announced Ramadan Bonanza Raffle using gamification strategy and offering 600 Galaxy S21 Ultra 5G smartphones emphasizing on delighting their customers. Malabar Gold & Diamonds is strengthening its CSR campaign this festive season by offering over 500K iftar meals as part of this festive season.
‘Satisfaction is a rating… Loyalty is a brand.’
Quoted Shep Hyken, a noted Customer Service public speaker and Chief Amazement Officer (CAO) at Shepard Presentations. He focusses on the significance on how a loyal customer base makes companies transform into world-class brands. Undoubtedly, credible loyalty programs form a major part of this ideology as it promises a devoted set of customers.
A study backed by McKinsey group claims 87% of shoppers in Middle East and Africa are inclined to shop with a retailer that offers retail loyalty programs. It therefore, comes as a no-brainer that the Middle Eastern market’s upgraded promotional schemes like visual merchandising, advertising and loyalty programs are an inspiration to the global retail industry to catapult customers that are driven by innovative loyalty programs. An equally telling research by iVend Retail Worldwide revealed that 53% of shoppers in the Middle East shop exclusively to earn loyalty rewards and points. As we embark on the evolution of retail loyalty programs in the Middles East, let’s begin by understanding what makes a retail loyalty program so worthy. Before we move ahead, take a look at the figures below drawn from the iVend Retail research focusing on why shoppers vouch for a loyalty program in the Middle East retail market.
As per iVend Retail Research 2019 report
As we dive deeper into the retail segment of the Middle East, let’s take a cue from some of the lauded retail loyalty programs that have been there and continue to churn profitable wallets, rooted by a loyal customer base.
A premium rewards program by Al Tayer Group, Amber has partnered with more than 80 brands including automotive brands like Ferrari and Jaguar thereby bolstering its premium presence across the world. Amber offers memberships categorised as Classic, Select and Plus offering a wider gamut of rewards and privileges. However, Amber‘s major evolution begin in 2016 with the launch of the new Amber App in UAE, Qatar, Kuwait, Bahrain and Saudi Arabia. A highly rated App, it is available in English and Arabic languages. Amber’s digital evolution has not only impacted its current customer base which rose 13x than before, but the conversion rate too which has scaled up to 2.5 times.
2. Shukran Rewards
Translated as ‘thank you’ in Arabic, Shukran Rewards is owned by the renowned Landmark Group in Dubai offering almost 57 global brands. This award-winning loyalty program in the Middle East boasts of over 10 million members spread out over 9 countries owing to its decade-long presence in the market. While the company started its innings by offering a physical card and but in 2016, owing to the digital evolution, the company announced its virtual card which could be downloaded from the Shukran App available on both iOS and Android.
3. Club Apparel
Offering a range of over 75 brands currently, Club Apparel started with a cardless, App-based loyalty program and is helmed by the Apparel Group across entire GCC (Gulf Cooperation Council) region. It was also the first entity to offer a digital retail experience in the retail loyalty program segment. The group has enjoyed a massive customer base and to further strengthen their subscribers, it was in 2016 when the Cardless maverick introduced a three-tier membership program offering more privileges, rewards and access to VIP events at every tier to their subscribers. This move was aimed at offering exceptional services to its shoppers.
World’s second largest retailer Carrefour partnered with Majid Al Futtaim Group to launch this loyalty program in UAE. While all the other loyalty programs focus on Lifestyle and Fashion brands, Carrefour is the only loyalty program catering to the quintessential commodity – groceries. A lifetime free card, it is available at 17 Carrefour Hypermarket and 19 Carrefour Supermarket in the region. With the foray of digitization in the retail segment, Al Futtaim Group launched a loyalty program namely SHARE in 2019 under which Carrefour points can also be clubbed now. This move was aimed at customer convenience by allowing shoppers the flexibility to earn and redeem points with other partners by downloading the SHARE App.
5. SHARE Rewards
Spearheaded by the Majid Al-Futtaim Retail Group, this is the Group’s first centralized customer loyalty program offering lucrative rewards when shopping with the Group brands and partners across 17 malls in the GCC & Egypt regions. A recent entrant in the retail loyalty program bandwagon, SHARE Rewards is rated 4.5 on the Google Play Store and is a popular choice for shoppers in UAE. SHARE Rewards redemption is also applicable on other Al Futtaim brands including Carrefour, VOX Cinemas, Magic Planet, Ski Dubai, Little Explorers, iFly Dubai, Crate & Barrel, American Girl and Lego making it an irresistible deal for shoppers.
Transition from loyalty cards to loyalty apps
The above tabular representation signifies the digital evolution that surged in the Middle East Retail market around 2016. The ubiquity of retail loyalty Apps in the Middle East largely reflect how digitalization wave has gripped the region. Indeed, the recent Pandemic times has exhibited a major shift in the shopping behaviour across the globe with Middle East not being an exception. This statement is further quantified by a consumer incentive study by Wirecard which highlights the fact that 70% of shoppers are accessing App for a fuller control of their retail choices and experiences. With the tipping scale pointing more towards the consumers now, App-based loyalty programs can be a game-changer. The recent move by Al Futtaim Group also stands as a testimony to a forthcoming evolution in the retail industry. Given the facts, figures and the current industry moves by many stalwarts; it can be said that…
… the evolution in retail has begun; the revolution is not far behind.