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Loyalty programs are a powerful tool for businesses to retain customers, increase revenue, and gain a competitive edge. But how are loyalty programs evolving in the face of the current economic crisis, inflation, and potential recession? And what are the best practices and benchmarks for loyalty program owners in India, one of the fastest-growing and most diverse markets in the world?
In this blog, we will explore the loyalty program trends in India, based on the Global Customer Loyalty Report 2023-2024 and share some insights on how to design and implement a successful loyalty program in India using the latest technology and customer data.
Loyalty programs are essential for businesses to overcome the inflation crisis and a potential recession, as 55.9% of companies globally view the role of customer loyalty as such.
The loyalty program business in India is expected to be worth around $3.4 billion in 2023, and it's predicted to grow to $14.5 billion by 2033. This represents a steady annual growth rate of about 15.7% during this period. In comparison to the worldwide loyalty program market, India's share is roughly between 4% and 8%.
CAGR (2023 to 2033): ~15.7%
Market Value (2023): US$ 3,363.4 Million
Growth Factor: Rapidly growing demand for tools enabling real-time tracking of ROI for loyalty programs.
Key Trend: Introduction of loyalty programs based on tier-wise classification of channel partners.
The India Loyalty Program Market is witnessing remarkable growth, with an estimated value of US$ 3,363.4 Million in 2023, projecting a robust Compound Annual Growth Rate (CAGR) of ~15.7% from 2023 to 2033. The surge in demand for tools facilitating real-time tracking of Return on Investment (ROI) is a key driver behind this expansion. Businesses are increasingly seeking efficient means to measure and optimise their loyalty initiatives, contributing to the adoption of advanced tracking tools.
There are two major loyalty program trends that are shaping the Indian b2c setup. Let's take a closer look at each of these trends and how they can benefit Indian businesses and customers.
Scan & Win is India's QR code-based Consumer Engagement Program, designed to retain consumers and boost sales. Using QR codes, businesses connect with consumers, capturing data for personalised marketing. The program provides instant rewards through virtual spinning wheels, aiming for a 40% sales boost and efficient data-driven campaigns. GenefiedTech offers this solution, prioritising consumer happiness and providing tailored engagement strategies.
Overall, it's a comprehensive, data-driven solution for businesses seeking personalized and rewarding consumer engagement.
Increased Sales: It helps in a nearly 35% increase in sales
Data Visibility: Brands have shown tremendous results by achieving upto 90 visibility in data that allows for a clear understanding of customer behaviour, preferences, and other relevant insights
Retailer Engagement: Successfully engaged retailers, potentially strengthening partnerships or collaborations
Large Retailer Network: Helping brands expand the reach and availability of the promotion
Data-Driven Insights: Provides valuable information for future decision-making
Consumer Data Capture: Helpful for targeted marketing and a deeper understanding of the consumer base
Rewardify stands as India's premier QR code-based Loyalty Solution, cultivating loyalty among retailers, distributors, and influencers. The platform employs unique QR codes for maximum brand loyalty, offering a point-based digital retail program that enriches brand identity and satisfies supply chain partners.
By gamifying loyalty, Rewardify ensures instant reward redemption, reducing the churn rate by 40%. With end-to-end digitised reward management and flexible schemes, retailers can benefit from a seamless and rewarding loyalty experience, fostering an emotional connection with customers.
The platform, powered by Genefied, facilitates data-driven decision-making, automates loyalty schemes, and drives repeat sales through gamification, ultimately promoting overall brand growth.
Personalised Communication: Brands can achieve smooth customer loyalty management by utilising seven different channels for personalised communication, which implies a comprehensive approach to engaging with customers, enhancing the chances of connecting with them on a personal level.
Enhanced Customer Retention: Adoption of loyalty programs and incentives, contributing to customer retention by rewarding and encouraging repeat business.
Geo-fencing of Wholesalers: Geo-fencing indicates a targeted approach, possibly ensuring that the customer loyalty program is reaching the right audience in specific locations.
Here are some best practices on how to design and implement a successful loyalty program in India:
Align your loyalty program with your business goals and customer needs, and define clear and measurable KPIs and metrics to track and evaluate your loyalty program performance and ROI.
Offer rewards that are personalised. FOMO leadership can motivate the customers to engage more with the brand.
Customise consumer engagement programs to suit your business.
Loyalty programs are a vital strategy for businesses to overcome economic challenges and retain and grow their customer base. India, as one of the most dynamic and diverse markets in the world, offers a great opportunity and potential for loyalty program owners to innovate and differentiate their loyalty programs. The success seems to stem from a well-rounded approach that leverages both proactive (push) and reactive (pull) elements in engaging with customers and retailers.
Q. What kind of loyalty programs are popular in the Indian market?
Point-based and predetermined loyalty programs are the most favoured types in India, making up a significant 65.5% share. Among these, point-based programs are particularly prominent in 2022 due to their simplicity in earning and redeeming points.
Q.Why is customer loyalty crucial?
Customer loyalty is important because it helps cut costs by lessening the need for acquiring new customers. By investing in customer loyalty, a company can easily deal with a reduced churn rate.
Source- futuremarketinsights.com
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