Industry Applications of Success Factors from Loyalty in Luxury
After discussing the main success factors in luxury loyalty, we have determined three factors that, based on the data observed have, the most impact. Now it is vital that we take a closer look at how these can apply to other industries.
The three most important success factors that we extracted from the loyalty checklist were:
By observing the statistics and examples discussed in the post, the impact of these 3 factors becomes clear. Therefore, we will be applying them to other relevant industries, such as Gaming, Retail, Travel, and more, in hopes of giving you an even greater insight into how you can maximize your loyalty program potential.
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Having a great product portfolio and providing awesome experiences for your customers, is a core aspect of redemption options. This is why it is such a vital success factor, because with the best redemption options, the best rewards, the best experiences, customers will have more incentive to engage with your brand.
Always remember by providing awesome redemption options both transactional and experiential ones, you are automatically boosting the customer experience and satisfaction, which has been directly linked to loyalty to the brand.
In fact, it was observed that there was a 1.6x lift in satisfaction among loyalty members who actively redeem their points vs. members that have a low redemption rate (Bond).
In industries like gaming, travel, and hotel it has become clear how effective it is to incorporate exclusive and attractive rewards that are targeted at newer generations with a focal point on customer satisfaction. Better rewards incentivize loyal behavior towards your brand and give users more reasons (options) to use your program. Below are some exciting stats displaying successful redemption options from these industries.
Industry Use Cases:
- In the travel and hotel industry, consumers voted these as their top four most favored redemption options (GBTA):
- Free nights (47%)
- Room upgrades (46%)
- Express check-in (38%)
- Service perks (30%)
- Bethesda Leverages social media to invite gamers to exclusive behind-the-scenes and first look experiences as a reward for engaging with them on their social media channels (giveaways).
Using state-of-the-art technology that is easy to use, fast as well as secure, is vital for the success of any loyalty infrastructure. Considering the research observed, a blockchain-based infrastructure provides all these benefits, as described by Deloitte in their, “Making blockchain real for customer loyalty rewards programs” article.
Also, don’t forget to use the power of social media, and user engagement. As it can be a great way to leverage technology in your favor and enhance your marketing capabilities.
95% of loyalty program members want to engage with brands through a mix of new, emerging, and growing tech, including blockchain-based platforms, augmented reality (AR), virtual reality (VR), and more (Bond).
People always follow the newest trends, and that is no different with technology and loyalty. When customers find out that a platform is getting an upgrade or that a new app comes out, they want to try it out. So automatically by using the newest up-to-date technology, you are putting your brand at an advantage.
Another study by Bond shows us that early technology adopters are willing to pay more for enhanced loyalty benefits linked to technological upgrades → 69% of early adopters said yes to paying more for enhanced loyalty tech. Even in households with children, the result was surprising with 44% willing to pay more.
- In an industry like gaming where users are more up to date with the newest tech, implementing innovative loyalty programs with new features is easier and more appealing to the target segment.
- In the retail industry, 85% of loyalty members who were able to use multiple touchpoints, such as apps to redeem their points, reported having a greater experience due to technology (Bond).
Integrating new partners into your own network or joining one should be at the forefront of your decision-making. Find partners that compliment your philosophy and collaborate on loyalty projects, decentralize the process and always integrate new brands. That is the key to success when planning for a loyalty program that should be durable in the long-term.
It was shown that “70% of consumers overwhelmingly like the idea of programs partnering with other brands to increase ways to earn loyalty points” (HelloWorld).
We know from previous research that stand-alone programs are not long-term in fact they tend to die out… so it is important to join a loyalty ecosystem, a network of partners where loyalty between brands and fans can be shared. Leading to a better customer experience where fans can benefit from more options both on the earn and burn side.
- The Louis Erard program allows the brand to access the whole member ecosystem of Miles & More and Etihad Guest Miles, which includes 35m+ members. Creating more value for existing watch enthusiasts by giving them more earn and burn options as well as appealing to a whole new audience of watch lovers.
- Take the Chinese company, Tmall, and their loyalty program “88VIP”; So far the loyalty program has already established a collaboration with Alibaba and their video-company, providing users free streaming benefits if they are part of the program. Similarly to what Amazon is doing with Amazon Prime.
Key Takeaways (TL:DR)
Point 1: Exciting redemption options are the most valuable incentive for users to join your loyalty program and engage with it, so keep this success factor at the top of your list. Industries like gaming could profit from improved reward options.
Point 2: Always seek to implement state-of-the-art tech, give yourself that advantage over the competitor and work from there, build upon blockchain-based infrastructures as they will shape the future of loyalty as we know it for all industries.
Point 3: Think long-term, join a loyalty ecosystem. Put your fans at the forefront of the discussion and allow them to access a larger network.
Success can come from many factors, as we saw in the loyalty checklist last week, but there are a combination of practices that lead to the ultimate success of a loyalty program, but we truly believe that the 3 factors mentioned above are some of the core ones necessary for brands in any industry to succeed in their loyalty journey. So keep them close to you when developing, maintaining, or even just improving your loyalty program. There is always room for improvement, we just need the right set of tools to find it.
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