Digital Strategies and Best Practice in Loyalty Programmes
2018.10.15   |   46 pages   |   Digital Transformation

Author:
Nicola Warren


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High levels of mobile penetration in mature mobile markets have led to reduced rates of growth in terms of subscriber numbers for market participants.  This coupled with the rise of customer power and consumer value-seeking trends, means that MNOs are under pressure to secure their existing subscriber bases.

To this end, operators have made customer experience (CEX) improvement a core focus for digital transformation, to ensure that customers have fewer reasons to leave the MNO.  However, they should also consider what can be done to encourage desirable behaviours from these customers going forward (e.g. increased tenure, advocacy, basket size).

This report examines the use of digital approaches within loyalty programmes designed to influence these kinds of behaviours.  It looks at digital components within successful loyalty schemes and determines potential learnings for operators considering, or re-evaluating, their own loyalty initiatives.

 

Companies: Amazon, Recreational Equipment Inc, Starbucks, Three, Verizon, Reliance Jio, Sky, Pets at Home, giffgaff, Sephora, O2, Waitrose, Nike, Virgin Media,

Countries: USA, UK, India

Keywords: loyalty, personalisation, pain points, Verizon Up, customer relationship management, digital, CRM, Starbucks Rewards, key performance indicators, Prime, loyalty programme, threshold factors, Wuntu, rewards, customer lifetime value, Priority Moments, digitization, customer first, customer engagement, blockchain, Amazon Prime, emotional loyalty, customer service, benefits, customer experience, total cost of transaction, churn, Jio Prime, ecosystem, relevance,

1

Overview

1

2

Introduction

2

2.1

Background to the Report

2

2.2

Report Content

3

2.3

Currency and Conversions

3

2.4

Further Questions and Feedback

3

3

Steps to Loyalty

5

3.1

Introduction

5

3.2

Customer First Strategy

5

3.3

Customer Experience

5

3.4

Increased Customer Engagement

6

4

Considerations for Loyalty Initiatives

7

4.1

What Behaviours to Reward

7

4.2

Emotional Aspects of Loyalty

8

4.3

Type and Structure of Rewards

10

4.4

Total Cost of Loyalty Transaction

13

4.4.1

Threshold Factors

14

4.4.2

Monetary Cost

14

4.4.3

Effort

15

4.4.4

Risk

15

4.5

Digital Mechanisms

15

4.5.1

Introduction

15

4.5.2

Digital Engagement

16

4.5.3

Data-based and Personalised

18

4.5.4

Blockchain

19

4.6

Key Performance Indicators (KPIs)

20

5

Case Studies of Loyalty Leaders

21

5.1

Amazon

21

5.1.1

Introduction

21

5.1.2

Loyalty Initiatives Overview

21

5.1.3

Performance

22

5.1.4

Success Factors

23

5.2

Recreational Equipment Inc

24

5.2.1

Introduction

24

5.2.2

Loyalty Initiative Overview

25

5.2.3

Performance

27

5.2.4

Success Factors

27

5.3

Starbucks

28

5.3.1

Introduction

28

5.3.2

Loyalty Initiative Overview

29

5.3.3

Performance

31

5.3.4

Success Factors

31

6

MNO Case Studies

33

6.1

Verizon, USA

33

6.1.1

Introduction

33

6.1.2

Loyalty Initiative Overview

33

6.1.3

Performance

35

6.1.4

Success Factors

35

6.2

Reliance Jio Infocomm, India

36

6.2.1

Introduction

36

6.2.2

Loyalty Initiative Overview

36

6.2.3

Performance

38

6.2.4

Success Factors

38

6.3

Three, UK

39

6.3.1

Introduction

39

6.3.2

Loyalty Initiative Overview

39

6.3.3

Performance

40

6.3.4

Success Factors

41

7

Findings and Conclusions

43

8

Recommendations

46

 

Appendix – Feedback Questions

48

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