Tom Peace, from The Loyalty People, shares his thoughts on how these predictions have held up and what’s going to win through 2023. Of particular interest is the growing customer need for emotional connections with their loyal brands and the move towards subscription based loyalty programmes.
Hosted by Tom Peace
4) Tom Peace
Paula: Welcome to Lets Talk Loyalty, an Industry podcast for loyalty marketing professionals. I’m Paula Thomas, the founder of Let’s Talk Loyalty. Today’s episode is hosted by Tom Peace, Managing Director of the Loyalty People, a strategic consultancy with a laser focus on loyalty, CRM, and customer engagement.
The Loyalty People also runs a free global community for anyone working in the loyalty industry. If you are working in loyalty marketing, Make sure to join Let’s Talk Loyalty every Tuesday, Wednesday, and Thursday to hear the latest ideas from loyalty experts around the world.
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Tom: Hello, listeners. Thanks for tuning in. I’m Tom Peace, Managing Director of the Loyalty People, and I’m here to provide another short summary on behalf of Let’s Talk Loyalty, this week’s five minute summary show highlights Paula’s interview with Brad McDonald, Epsilon’s, Vice President of Loyalty Strategy, which first aired on the 2nd of December, 2021.
This was a fascinating show and it’s really interesting to look back one year on to see which predictions have held true. Hopefully my summary show will wet your appetite and you can find the original show on www.letstalkloyalty.com, episode number 165. It’s really great to hear from Brad who has both brand and agency experience and is right at the forefront of loyalty in his role with Epsilon.
So in December, 2021, Brad discussed five major predictions for loyalty trends, and I’m really glad to say that they’re all strong trends now, 12 months on, Brad really got this one right. The first prediction Brad discusses is a trend towards emotional connections versus rational benefits. And this couldn’t be more true today.
Rational benefits like promotions, airmailes, or reward points just aren’t enough anymore. Members want to feel an emotional connection with the brands they are loyal to, and this can be created in a variety of ways, some of which Brad discusses with Paula.
Principle to an emotional connection is good old-fashioned customer experience, which is the second prediction that Brad discusses. Many brands are realizing that customer loyalty is often driven by core business functions such as price, convenience, product quality, or excellent service. Adding a traditional loyalty program on top of a strong business operation can be very powerful, but the core customer experience must be strong, and many brands are seeing this as the best way to execute on customer satisfaction.
Brad also discusses the significant feel good factor that charitable donations can provide for a loyalty member. This can be achieved in several ways, principle, which is points donation for loyalty programs. This is a great strategy because it makes the member feel generous and giving whilst being bound to the brand in terms of points earn.
And we all know that burn drives earn within points reward type programs. So this is an excellent strategy for loyalty program managers.
Brad’s fourth prediction is the emergence of subscription based or paid for loyalty, and I think this is the one more than the others that has really grown quickly in the last 12 months.
For a brand’s point of view, this is a no brainer. Can you get your customers to actually pay to be loyal to your brand? And from a member’s point of view, the psychological incentive is extremely powerful if the value proposition is simple and economically justified. Many, many brands are investing in this now across all sectors, and I think this is a trend that is definitely here to stay.
And finally, Brad’s last trend prediction is around the use of gamification as a way for customers to engage. I honestly can’t disagree that this is an emerging trend, but I’m not sure that loyalty programs are quite getting this right just yet. The theory of gamification in other sectors is to make the game tough and the reward high so that the feeling of frustration builds until you finally win.
This gives the gamer a really strong feeling of reward and achievement. Loyalty programs, however, tend to create games that are easily achievable without the same level of friction and therefore emotional investment. And I look forward to a brand that really innovates in this area as this too is definitely a trend for the future.
Thanks for listening. I hope you enjoy the summary show. This show discusses some really important loyalty strategy, best practice, and is well worth the list. All the best and speak soon. Tom.
Paula: This show is sponsored by The Wise Marketer, the world’s most popular source of loyalty marketing news, insights, and research. The Wise Marketer also offers loyalty, marketing training through its Loyalty Academy, which has already certified over 500 executives in 38 countries as certified loyalty marketing professionals.
For more information, check out thewisemarketer.com at loyaltyacademy.org.
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