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Have you seen The Customer Experience Factbook?

In this 180+ page report, you'll find all the information and support you need to build a profitable, effective CX Improvement Program that spans every part of your business. You'll be able to implement and manage meaningful and profitable change, and grow your bottom line despite a slowing economy.

Get it on Amazon (Kindle/Print)
 

Customer Loyalty has become a US$323bn global market

Companies are spending 4% of revenue to activate customers

Customer loyalty is big business and getting bigger. The new research report "Loyalty Big Picture," from global loyalty expert LoyaltyOne, found that the total 2019 customer ecosystem is a whopping US$323 billion. That loyalty landscape includes US$126 billion in direct loyalty and customer relationship management, along with significant investment in technology and transaction enablers and customer engagement platforms.

And the loyalty industry is growing: 69% of C-suite executives reported that they've increased loyalty investment in the past two years, with more than half (55%) saying their investments will continue to grow over the next two years.

Increasingly, the value of loyalty and the insights garnered from customer loyalty strategy are influencing decisions across organizations, said Caroline Papadatos, Senior Vice President, Global Solutions for LoyaltyOne. In fact, while there might be a public perception that loyalty cards' usage is waning, the opposite is true - their popularity is exploding, she said.

Companies are recognizing the value of using customer data for everything from product development and pricing optimization to real estate planning and even media. More than half of companies (61%) said they use loyalty data across at least three different departments, and a mere 2% of industry practitioners surveyed reported that loyalty data is used strictly by traditional departments like marketing and public relations.

"Executive teams see how programs can contribute to company valuation," said Papadatos. "In fact, 88% of loyalty practitioners said their company leaders view loyalty program strategy as an important component of the overall company strategy."

Companies Invest Upwards of 4% of Total Revenue
In short: Loyalty matters more than ever to companies across industries, especially in highly consumer-driven areas such as retail, financial services and hospitality. Facing increasing competition and shrinking budgets, they're relying on loyalty's data collection, insights and rewards to unify end-to-end customer management and all the ways to activate customers and shape their behavior.

To that end, companies are putting significant money behind their loyalty efforts: More than 71% said they're investing a minimum of 2% of total revenues, with most spending upward of 4%, for loyalty and CRM to activate customers and leverage the data asset to create personalized offers and extensions, according to "Loyalty Big Picture."

What are they getting for that investment? There's good news on that front: The research found that loyalty program members contribute to almost half (43%) of companies' annual sales. A full 95% of companies reported that members spend more than non-members annually, with 60% reporting that members spend two to three times more than non-members.

As evidence of just how valuable the ROI can be, a significant number of vendors and other third parties are willing to pay for participation in programs. Indeed, more than half (53%) of loyalty practitioners surveyed for "Loyalty Big Picture" reported that vendors or other third parties fund offers for their loyalty programs.

Plenty of Opportunity for Change
The report unveils plenty of opportunities for retailers and other program operators to better capitalize on their investment. One such area: consideration of fee-based programs.

More than three-fourths of consumers (76%) reported that they do not pay a fee for the loyalty programs in which they participate, but 64% would be willing to do so in exchange for additional benefits including discounts, expedited free shipping and better earn rates. To that end, more than half of companies surveyed reported that they are considering implementing fee-based programs.

Another area of opportunity: Only 30% of companies cited "increase the value provided to loyalty members" as a reason they increased their loyalty investment in the past two years. Many loyalty operators fail to fully dig into the data that loyalty programs collect and realize all the benefits.

"The fact is, many loyalty operators benchmark against the competition and take their lead from market forces, not realizing that demand is being shaped by their customer," said Papadatos.

Digging Deeper into the Big Picture
The report offers a deeper look at the insights above as well as other key findings, including:

To create the global benchmarking "Loyalty Big Picture" report, LoyaltyOne talked to decision-makers, industry experts and consumers, gathering data and insights from 1,224 loyalty operators and 4,721 members across five markets - the U.S., Europe, South America (Brazil), Asia (Singapore) and Canada. Loyalty practitioners interviewed were from industries including high-frequency retail, finance, specialty retail, travel/hospitality, consumer packaged goods or automotive - from companies reporting a minimum annual revenue of US$250 million. Significance testing was conducted at the 95% confidence level. LoyaltyOne also conducted additional secondary research.


Sources: LoyaltyOne /
The Marketing Factbook.
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    Categorised as:

  • Customer Experience
  • Customer Loyalty
  • Knowing The Customer
  • Marketing Know-How
  • Marketing Technology

Have you seen The Customer Experience Factbook?

In this 180+ page report, you'll find all the information and support you need to build a profitable, effective CX Improvement Program that spans every part of your business.

You'll be able to implement and manage meaningful and profitable change, and grow your bottom line despite a slowing economy. Grab this goldmine of easily adaptable and up-to-date strategies, walk-throughs, trends, technologies, research, suppliers and partners, plus all the supporting arguments you need to build a solid CX strategy.

While most marketers could list maybe a dozen key points for improving their brand's Customer Experience (CX), the researchers and writers at The Marketing Factbook have identified FORTY main 'CX Keys' which will help you drive your customers to new levels of delight, loyalty, advocacy and profitability.

The areas in which customers have direct contact with your organization are perhaps the most obvious places in which CX improvements can be made, and this report addresses all 24 of these 'Direct CX Keys', applicable to offline and online businesses alike.

At the same time there are many other areas that indirectly affect CX (such as the supply chain, policies and processes) in which every business can make simple but far-reaching improvements. This report guides you through the problems and solutions for all 16 of these 'Indirect CX Keys', many of which are often forgotten or under-played even in the best CX strategies.

Get it on Amazon (Kindle/Print)
 
Copyright © 2001-2025 Peter J. Clark