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Loyal customers remain a driving force behind every successful business.
They repeatedly choose to purchase your products or services and spread the word about your brand. In return, you should provide a rewards program for small businesses that incentivizes their loyalty.
Research on loyalty program reported that one in four customers remains loyal to brands that reward their loyalty with promotions, coupons, or vouchers. A recent PwC survey found that 63% of executives increased their brand’s loyalty program budget in the latest planning cycle, meaning that more and more companies are developing a loyalty strategy.
However, although businesses understand the importance of customer loyalty, it takes time to launch an effective program.
Here’s where customer loyalty software like PassKit comes in.
With our platform, you can design a loyalty program hassle-free. PassKit helps you create loyalty program cards your customers can store and use with Apple and Google Wallet.
Using their mobile devices, they can collect points for their activities and redeem them for various rewards whenever they are at your business location.
With PassKit, you’ll get an all-in-one loyalty program app to automate manual processes and enjoy increased efficiency and productivity.
We cover all your needs – from creating, managing and distributing your loyalty customer cards to detailed analytics and ROI tracking.
Sign up to start your 45-day trial!
This article will examine top customer loyalty trends to implement today into your business and explain how PassKit enables you to stay relevant and attractive to customers.
Let’s start with some basic information.
What are customer loyalty programs?
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Customer loyalty programs reward consumers for purchasing from the same brands. This effective marketing strategy encourages people to return to your business.
Most companies launch a points reward system. That means that customers earn loyalty points for every purchase they make. They redeem points for free products, special offers or early access to sales.
Customer loyalty programs are more critical than ever. According to one research, 88.5% of consumers hope loyalty programs will allow them to overcome the current inflation crisis.
It’s high time to offer loyalty reward cards.
Why is customer loyalty essential for your business?
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Customer loyalty affects every part of your business. Without loyal customers, it’s impossible to thrive.
New customers are expensive to acquire. They also spend less than repeat customers do.
Customer loyalty is essential for the following reasons:
- It creates brand advocates – most loyal customers can represent your business. They are knowledgeable about your products or services, which makes them eager to spread the word. Brand advocates can attract new customers to your business at no cost.
- It increases sales and customer lifetime value (CLV) – customer loyalty leads to higher profits. Loyal customers spend more money during their relationship with your brand, especially if they have incentives on their loyalty business cards.
- It reduces marketing costs – word of mouth is a persuasive and cost-effective marketing tool. The average customer believes more in credible reviews than ads. You can reduce marketing costs if your customer base praises your products or services online.
- It creates meaningful relationships – customer loyalty establishes a meaningful and emotional connection with your consumers. Loyal shoppers trust you and feel like a part of your ever-growing family.
- It provides actionable insights – a customer loyalty program collects data. It tells you more about customer expectations, purchasing decisions and customer behavior. When you understand your consumers, you can target them with personalized offers and experiences.
Since we explained why customer loyalty is important, let’s discuss the biggest reasons for starting a loyalty program.
Should you start a loyalty program this year?
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Starting a customer loyalty program is never too early or too late.
Most loyalty program owners launch these programs for three reasons:
- They want to increase customer engagement by creating a community centered around their brand and engaging customers with relevant content.
- They aim to improve the customer experience by gathering historical and behavioral data about their customers, which helps them understand their preferences and desires.
- They want to improve customer retention by offering rewards and treating their customers as valued members of their brand community.
Your competitors may already be offering loyalty customer cards that draw new customers away from your business, so if you haven’t created one yet, it’s essential to act quickly.
Let’s review customer loyalty program trends your business should implement this year to stand out from competitors and how PassKit helps you along the way.
18 loyalty program trends to watch in 2023
Businesses use different tactics to attract their customers’ attention, and one effective method is to implement a loyalty program.
It’s crucial to stay up-to-date with current customer loyalty program trends to ensure your rewards system engages and retains customers.
Whether you’re starting a premium loyalty program or a free one, here are specific elements you should focus on to make it successful.
Personalized customer experience
Personalization is a significant loyalty trend that can help retain customers. A recent study found that nearly 50% of consumers would become repeat shoppers if they received a personalized customer experience from a brand.
With a personalized loyalty program, you can adjust your approach to individual buyers by analyzing customer data and creating unique experiences that meet their requirements and preferences.
It involves:
- Personalized recommendations
- Tailored communication
- Customized offers
Personalization also strengthens customer loyalty by making each consumer feel valued and respected by the brand.
PassKit, our loyalty platform provider, helps you create digital membership cards, coupons, loyalty cards for business and various passes such as digital tickets.
With our loyalty card design, you can add custom or advanced fields to collect and store customer information. You can also track individual buyer behavior and history to create personalized offers and increase their engagement with your program.
For example, if you run a coffee shop, you can use PassKit to connect your customers’ online and offline experiences. By collecting data on their preferences, such as ordering takeout, you can send promotions for online orders only.
Start your 45-day free trial to provide personalized experiences and boost customer loyalty.
Gamification
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Gamification is a popular trend in customer loyalty programs that uses game design elements to motivate customer interactions.
Adding features such as challenges, quests, leaderboards, and rewards can make the loyalty program more entertaining and engaging.
It, in turn, fosters a sense of loyalty towards the brand, encouraging continued participation and even customer advocacy through sharing experiences with others.
Gamification allows you to create an emotional connection with customers, enhancing the loyalty program’s overall experience and making it more memorable and enjoyable.
Mobile wallets
Customers rely on trusted payment services, such as Apple and Google Wallet, for their transactions.
These services eliminate the need for customers to carry cash or credit cards, as all they require is their mobile device to make payments. It presents a convenient and stress-free way of making purchases without the risk of losing their credit cards.
With PassKit, you can leverage the increasing popularity of mobile wallets. Instead of custom app building, bring the loyalty program to Google and Apple Wallet.
Depending on your industry, you can create, manage and distribute e-gift cards, loyalty cards, digital tickets, or boarding passes your customers can store and use with their preferred mobile wallet.
According to customer loyalty statistics, there were over 6 billion mobile device users in 2022. Tap into this brand loyalty trend to track consumer behavior and activity each time they scan their loyalty program card using a mobile wallet.
Social media integration
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The customer loyalty program trends list wouldn’t be complete without social media. These platforms allow you to form personal connections with your customer base.
You can enable customers to join your loyalty program with their social media profiles. They will get points for future purchases and social media activity, such as sharing your content for rewards.
Those who regularly shop from your brand will become online ambassadors and help you reach new audiences.
In addition to creating digital membership and loyalty cards, PassKit offers a feature that enables you to share the card’s URL on various social media platforms.
It means you can promote and distribute your loyalty cards to a broader audience, potentially increasing your customer base rapidly and efficiently.
With just a few clicks, your customers can save the cards on their devices, making it a convenient and hassle-free process.
Start your 45-day free trial to see how it works.
Eco-friendly rewards and incentives
Consumers expect commitment to sustainability from their favorite brands. Many businesses have adopted eco-friendly practices.
They reduce waste and use renewable energy to save the environment.
With PassKit, you can embrace these loyalty trends as well. You no longer have to distribute paper or plastic cards or spend a fortune on printing and distribution.
Our platform helps you set up your loyalty program fast, create digital loyalty cards, and promote contactless shopping. Our cards are paperless, so you’re saving the environment. There is also no need to design or print anything.
With PassKit, you can use all digital transformation benefits to boost your customer experience strategy.
Influencer marketing
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Influencers have the power to make or break a business.
According to an IZEA report, 56% of customers bought something after an influencer used it. Their impact on the global customer base is strong.
By collaborating with social media influencers, you can establish trust and credibility with your audience.
It increases brand awareness and customer loyalty. It also allows you to promote a loyal program and incentives like exclusive access to sales.
Referral programs
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Existing customers can recommend your business to others. Most of them do it willingly, but they wouldn’t object to getting rewards for their efforts.
That’s where referral programs come in.
A referral program awards a consumer for every new customer they bring. They receive vouchers, coupons, extra points or other incentives. It’s a win-win for your business.
You attract a new customer, while the existing one uses the rewards in the shop and increases your sales.
Employee engagement
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Although customers can find most answers to their questions online, nothing beats in-person interactions.
Investing in proper training for your staff and having helpful and knowledgeable employees can ensure your customers have a positive shopping experience and receive excellent customer service.
It is imperative for your loyalty program, as new customers may have many questions about how it works and the incentives offered.
Your employees should be able to assist customers with their queries and concerns to increase customer satisfaction and loyalty.
If they cannot answer customers’ questions or provide the necessary information, it is less likely that those customers will become loyal members.
Voice search optimization
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Optimizing your loyalty program’s content for voice search can boost customer engagement and participation. It simplifies finding and learning about your rewards program using voice assistants like Siri, Google Assistant, or Amazon Alexa.
For instance, customers can use voice search to inquire about your loyalty program’s rewards, sign-up procedures, or point redemption methods.
By optimizing your program’s content for voice search, you can ensure it’s readily available and easy to locate through voice assistants.
This strategy can drive customer engagement and foster brand loyalty.
Augmented reality
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Loyalty programs increasingly use AR to create unique and interactive customer experiences.
For example, you could create an AR experience where customers can use their smartphone camera to scan a product or display, triggering a digital reward or discount code. It could incentivize customers to engage with your brand and make a purchase.
Another way you can use AR in loyalty programs is by creating virtual loyalty cards customers can scan using a smartphone camera. It can make it more convenient for customers to access their rewards and make the loyalty program more fun and interactive.
You can also enhance the in-store experience by providing customers with additional product information or recommendations or creating immersive experiences incorporating the loyalty program.
These AR features can increase customer engagement and loyalty by making your brand stand out and offering unique benefits.
Subscription models
Loyalty programs based on subscription models require customers to pay a fee to become members. Usually, it is either a monthly or one-time fee.
Premium loyalty programs are prevalent in most industries, including beauty, hospitality and media.
If you include subscription models, you can create a recurring revenue stream. On top of that, a subscription-based loyalty program sounds exclusive, which can motivate more customers to join it.
Tiered programs
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One of the current trends in customer loyalty programs is the implementation of tiered programs.
In a tiered loyalty program, customers belong to different levels based on their engagement with your brand or the amount they spend. Each tier offers additional rewards and benefits, with the highest tier typically receiving the most perks.
Implementing a tiered loyalty program can be an effective strategy to increase revenue, as it motivates customers to spend more to reach the higher tiers and unlock better rewards.
This approach can create a sense of exclusivity, strengthening customer loyalty to your brand.
Multi-channel engagement
Nowadays, consumers are active on multiple digital channels. For example, they can watch a YouTube influencer while checking out the social media profiles of their favorite brands.
PassKit helps you increase customer engagement across all brand touchpoints.
We help you promote and distribute your customer loyalty program with a multichannel distribution system.
You can increase awareness of your loyalty program using the following:
- SMS marketing
- Social media
- Retail marketing
- Email marketing
- Search marketing
- In-store advertising
- POP marketing
- NFC payment
Start a 45-day free trial to see how PassKit works.
Geofencing
Geofencing allows you to target your audience at the right time and location to increase foot traffic and loyalty program engagement.
For instance, Burger King used to promote a $1 burger to customers whenever they were near a McDonald’s restaurant.
With PassKit, you can explore location-based marketing. Send location-based reminders and push notifications when customers come close to your location.
You can remind them of loyalty points, expiration dates and rewards they have at their disposal.
Artificial intelligence
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Artificial intelligence (AI) can be valuable for improving your rewards program. AI technology allows you to analyze customer data to identify patterns and predict behaviors.
AI can also help you improve customer service for your loyalty program. You can quickly and efficiently address customer queries and minimize response times by automating specific tasks with AI-powered chatbots.
For example, you can integrate AI-powered chatbots on your social media platforms so customers can easily ask questions about your loyalty program and receive immediate answers.
It can help reduce waiting times and alleviate customer service agents’ stress while keeping customers happy and engaged.
NFT loyalty programs
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An NFT loyalty program uses non-fungible tokens to reward customers. NFTs usually evoke one emotional response – the fear of missing out.
Consumers would rush to join the NFT loyalty program and do their best to get digital collectibles. It is its novelty that draws customers’ attention.
Compared to traditional loyalty rewards, NFTs are unique and limited. They aren’t mass-produced. Everyone has a chance to win a $5 voucher, but how many customers can win an NFT from a brand?
Exactly – not many.
Your loyalty program doesn’t have to rely entirely on NFTs. You can use NFTs in a specific campaign to drive engagement and excitement. That will set you apart from your competition and prompt customers to stick with your brand.
Brand partnerships
Another trend we’re seeing is brand partnerships. Two brands partner up to provide more enticing customer loyalty programs. Together, they expand their range of rewards and benefits.
That gives more value to the customer.
Loyalty partnerships are also helpful in tapping into a wider audience and different markets. By working together, the partners can exceed customer expectations and deliver relevant promotions to increase engagement.
Data analytics
There’s one customer loyalty trend that never fades away – data analytics. Successful loyalty programs rely on data to understand customers and tailor rewards and marketing tactics.
Your team can analyze order history, loyalty program usage and purchasing behavior. That is enough for you to know what motivates your customers to buy.
You can then personalize your campaigns to encourage specific actions.
Sophisticated loyalty program tools like PassKit collect and present crucial data automatically.
We closely monitor your customers to inform you about
- Loyalty program usage
- The number of enrolled members
- Uninstalled digital passes from wallets
- Deleted members
- Performance over time
- Preferred mobile wallets
- The best distribution sources
We also show you one crucial metric – redemption rates. Our analytics dashboard lets you know how many customers use points or rewards. You can optimize your efforts to encourage redemption if the number is too low.
All you need to do is start a 45-day free trial.
Loyalty program trends: Wrapping up
Loyalty program trends show that businesses must be unique to attract customers. Simply launching loyalty programs isn’t enough.
Offering personalized experiences, using advanced technology, being eco-friendly and collaborating with other brands are essential.
PassKit helps you create and launch a loyalty program in a few minutes.
Instead of building a custom loyalty program app, you can design your program for Apple Wallet and Google Pay fast and easy.
PassKit keeps track of every member, ensures you send the best offers at the right time and grows your customer base in days, not months.
FAQs about loyalty program trends
Check out the answers to the most frequently asked questions about loyalty program trends.
What is the trend for the loyalty program in 2023?
We see several trends for loyalty programs. However, the most prominent ones are:
- Personalization to deliver a more relevant customer experience
- Multi-channel engagement to interact with consumers on numerous platforms
- Geofencing to communicate with shoppers at the right time
- Brand partnerships to create a loyalty program that brings more value
- Referral programs to encourage customers to recommend your business
- Gamification to make your loyalty program more fun and engaging
What is the future of loyalty programs?
Customers’ needs and expectations are changing. However, innovative, customized, sustainable loyalty programs can keep up with these shifts. Ensure that your loyalty program leverages technology and puts consumers first. That’s how it will thrive for years.
What are the new trends in customer loyalty?
The latest trend in customer loyalty is gamification. It uses game-like elements to encourage engagement and interaction. Customers compete against each other for rewards and points. That friendly competitive spirit is what motivates them to participate.
What customers are looking for in loyalty programs
Most customers have similar expectations of loyalty programs:
- Enticing rewards
- Exclusive offers
- Digital membership cards or loyalty cards
- Corporate social responsibility
