#298: South African Loyalty Insights 2021 - Short Summary Show

Welcome to Let’s Talk Loyalty an industry podcast for loyalty marketing professionals. I’m your host, Paula Thomas, and if you work in loyalty marketing, join me every week to learn the latest ideas from loyalty specialists around the world.

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Hello, and welcome to this week’s short episode of Let’s Talk Loyalty. I’m your host, Paula Thomas, and today I’m revisiting my September, 2021 conversation with Amanda Cromhout, who is the CEO and founder of Truth, the South African Loyalty Agency. Amanda had joined me to discuss her insights from the sixth loyalty white paper carried out by both Truth and Brand Mapp.

And although this research is purely done for the South African loyalty market, I firmly believe that their insights are super valuable to anyone in the global loyalty industry and provoke some great and interesting ideas for you as our global audience. Also, as we coincidentally share today, the highlights of the 2021 research, I wanted to also let you know that Amanda’s 2022 research, the Seventh Edition, actually launches today. And then of course, Amanda is joining. Let’s Talk Loyalty again next week to share her latest insights.

So back to the September, 2021 edition, and as you can imagine, the most striking insights were around the impact that the Covid Pandemic had on consumer behavior, particularly as it relates to loyalty programs.

By way of context, Amanda first explained that in South Africa, 74% of economically active people do use loyalty programs with 76% of men using them, and 72% of women. In fact, this was a dramatic increase in usage by men, and it was the first time that men became more engaged in programs than women, perhaps due to the influence of men being more involved in how so decisions by being at home during the pandemic.

It seems they began realizing the value of becoming active with those programs. Another fascinating statistic was that in 2021, the average number of programs that South African consumers were members of had jumped 50% to an average per person of 8.7 programs. This was a huge growth in people deciding to join and engage.

Globally, it compares to an average in the United States of 16.7, which is perhaps one of the highest in the world, and something we love to know for a global audience as a comparison. As well as the dramatic increase in membership, of course, the key is what impact these programs are having on how people behave.

The Truth/Brand Mapp research paper explicitly asks respondents whether by being member of a loyalty program, They believe it actually influences where they shop, where they bank, where they might fuel, and even where they eat. And the research conclusion is absolutely a resounding, Yes. Now, of course, this is what people claim rather than what they necessarily do in practice, But the response is so strong that it simply cannot be ignored.

The impact of loyalty programs is real, and a whopping 91% of customers who are members of programs said it influences where they shop, products they buy, and lots of other very important commercial impacts. Also, usage does of course, vary by age, and the 2021 Truth/Brand Mapp study mirrored research from other markets such as the UK.

One of the key findings is that the younger generation, and this is defined as age 18 to 25, we’re generally less interested in loyalty program. And that probably reflects how much they can experience the value of a program given their early stage as consumers. However, we definitely do learn that when they do engage, they’re more interested in brands with propositions around sustainability or social responsibility.

They’re also more demanding, so the idea of earning loyalty points slowly over time is something they definitely resist. Instead, they’re asking for and expecting, things like cashback or other instant rewards and benefits. Amanda then explained the various leading South African brands that are successfully driving loyalty across all of the various sectors.

We talked about grocery, pharmacy, and banking, and she explained the detailed insights in the full interview. There’s also plenty of competition in the industry as well, and Amanda always loves to ask respondents to name the one loyalty program, but they simply couldn’t live without. I think that’s Amanda’s favorite question every year.

A final topic that we discussed was the loyalty identifier that South African people prefer to show in store to earn their points. Personally, I like to use my phone number because I know it by heart. I don’t have to pull out my wallet. So for me, it’s definitely the easiest. But in South Africa there is a pattern of sim swapping, so that’s something that’s actually not used in the context of loyalty.

Also, a lot of South African consumers prefer not to use apps as they mightn’t have enough data or memory on the phone. So the research conclusion was the simplest solution and by far preferred by South African consumers is a regular card that they can keep in their wallets, take out, and swipe.

So it’s a big learning. Even as digital solutions change and improve, it seems that consumers sometimes just prefer the approach that they know and trust. I think this research proves again, just how important it is to talk to your customers in order to earn their loyalty, rather than just assuming that everyone might want the latest innovation that we might be excited to use.

That’s it for today. As I mentioned, you can listen to the full episode on letstalkloyalty.com/145. And if you want, of course, you can go straight over to the website, which is truth.co.za to find the reports for the last seven years now, including 2022.

That’s it for today’s short episode. Listening tomorrow when Amanda will be chatting with Dr. Shorful Islam, who is an experienced leader in data analytics. Then on Thursday I’ll be back with a fascinating interview with the Chief Loyalty Officer of Air Asia Rewards and their incredible super app. Thanks again for listening to Let’s Talk Loyalty.

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 245 executives in 27 countries as certified loyalty marketing professionals.

For more information, check out thewisemarketer.com and loyaltyacademy.org.

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