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Sky’s the limit: Do expensive experiences drive more loyalty?

Sky’s the limit: Do expensive experiences drive more loyalty?

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Customers today have high expectations from brands, and convenience often reigns supreme. But that doesn’t mean brand loyalty doesn’t have a part to play.

A report by Emarsys found that today 67% of customers considered themselves loyal to a brand, whether they were part of a loyalty programme or not. With many consumers having tried new products, stores, or ways of shopping during the pandemic, only one in five (19%) said that COVID-19 had made them less selective when it comes to brands.

As brands deploy insights from customers, products, and sales data to better understand their existing customer base, and personalise communications with context and relevance, Emarsys said that brands can progressively build engagement, drive lifetime value, and encourage behaviours that drive a profitable outcome.

In the same report, Emarsys said some common aspects of building loyalty include incentivised loyalty through discounts, rewards; loyalty inherited through association with other brands; and silent loyalty where customer loyalty is built without public advocacy or endorsement.

Today, aspects such as ethical loyalty founded on strong emotional connections and shared values also play a big role. On top of that, true loyalty – defined as unshakeable loyalty that’s built through brand love – is also critical for brands.

During a roundtable session hosted by MARKETING-INTERACTIVE, in collaboration with Emarsys, most of the attendees said experiences still play a key role in driving loyalty. According to Amélie Chaumont, client marketing director of Cartier, creating unrivalled experiences goes a long way in creating brand love and loyalty.

“We have a long history and deep values in creating meaningful experiences in line with clients’ expectations. They may say the experiences are amazing and unexpected, but only Cartier could do that,” Chaumont said.

And while often deemed as an expensive method to garnering brand love, industry players shared with marketing that creating experiences doesn’t necessarily have to be an expensive affair. Chaumont added there are always different levels of experiences brands can tap on depending on their relevancy and budgets that wouldn’t result in them being immensely expensive affairs.

Julian Sng, former marketing lead at Hilton Asia, said creating experiences should be considered an investment.

“If you consider your experiences costly, it means you failed. Because if you’re looking at it as a financial cost, then you know, you’re not doing it right,” he said. The spend on experiences should be viewed as an investment, because if measured and executed well, you should be able to see your Return on Investment (ROI).

“I learned a lot from my previous role at a budget airline, where I had very limited resources to run marketing campaigns,” he said.

“To promote our brand and achieve the desired impact, we reached out to other organisations that had like-minded values and similar objectives as us, including tourism boards and airport operators, to create shared experiences. By partnering with them, we not only had addition resources to increase the scope and impact of our campaigns, but also had a halo effect of   being backed by government-linked organisations.”

He added that brands can also offer money-can’t-buy experiences through partnerships.

Beyond points and rebates

Apart from creating experiences, the panel also discussed the power of points, to which Daniel Hagos, managing director of APAC Emarsys, shared that while points are still important in any loyalty programmes, brands must do more to make their programmes unique and more successful.

“Unique experiences, gifts that come after purchase, or limited offers can work well,” he said.

He added that marketers must think out of the box as not every execution needs to come with a hefty price tag. Done right, the execution can even come at no cost.

“Simple out of the box ideas such as mentioning a customer’s name in a marketing execution or making them feel seen can be done at a lower cost and have a higher gain in terms of what customers are looking for.”

Beyond experiences and points, rebates have also become a go-to for many brands looking to drive up purchases and earn loyalty. Last month, Bloomberg reported that ShopBack, one of the pioneers in the space of cashback services, had ambitions to attain US$150 million in funding to expand its services.

Meanwhile, the Alibaba-backed Lazada Singapore also launched a rebate scheme handing Singapore shoppers 9% cashback on eligible purchases for the rest of the year. The rebate scheme taps on a SG$50 million pool to support Singapore shoppers via cashback and other platform mechanisms.

With consumers now becoming more conscious about their disposable incomes, it is understandable why rebates might be an effective way of ensuring loyalty. However, to succeed, Emily Tan, head of marketing at ShopBack, said the platform is now looking to push beyond pure cash rebates and discounts.

While rebates and cashback is a great conversion driver, ShopBack is committed to adding value to a consumer’s shopping journey in other ways beyond cash rebates to make shopping delightful and rewarding. One way that ShopBack enables that is through the recently launched a price comparison featuresite, offering more information about which store or marketplace is offering the best deal, allowing consumers to make smarter purchase decisions.

She added that Shopback now wants to bring loyalty to the point where the brand is able to make ambassadors out of its consumer base. 

“So we are focused on really marrying loyalty in a traditional sense with new customer acquisitions,” she said.

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