Loyalty Program Strategies for 2018

January 31, 2018 Catherine Malone

As customer insight becomes more critical to overall business strategy, and customers expect personalization in exchange for their loyalty, loyalty programs will evolve to a new level of sophistication in 2018. Here’s a look into some of the big predictions for loyalty programs this year.

Brands Will Use Loyalty Programs To Help Understand Their Customers

survey finds that 99% of consumers are willing to share personal information in exchange for rewards as part of a loyalty program. Brands in 2018 are expected to know who their customers are, demonstrate relevancy and deliver exceptional experiences. Consumers expect brands to collect their information and communicate with them relevantly. More and more brands are using the insight gleaned from their loyalty programs to continually evolve their program and stay ahead of the competition. Programs will continue to position this year as an effective source of customer insight.

Personalization is Becoming More Sophisticated

Delivering exceptional experiences has become a primary objective for companies in 2018. In a 2017 survey of marketing and business leaders by Researchscape International, 96% of the respondents agreed that personalization helps advance customer relationships, and 88% agreed that their prospects and customers expect a personalized experience.

More than ever before, it’s the data available via loyalty programs that is enabling personalization capabilities to expand at a faster pace. Brands need to have a sophisticated approach when it comes to utilizing data to personalize experiences for customers and it’s often an opportunity marketers miss out on. Brands need to work towards distinguishing promotional offers based on previous consumer behavior and psychographic data collected and use that data to drive or offer relevant and effective promotions.

For example, Spotify closed out 2017 with their “2018 goals” campaign which was based solely around customer data. Premium members were given access to a completely personalized year-end recap of their listening habits from 2017. Not only was this an effective demonstration of how impressive their data capabilities are, the initiative helped make premium members feel valued, and promoted to non-users the benefits of a Spotify membership.

Emotional Brand Attachment is Driving Loyalty

A strong emotional engagement with the consumer can help retailers boost annual revenues by 5 percent, according to a recent report by Capgemini. The report found 82 percent of consumers with high emotional engagement would always buy the brand they are loyal to when making purchasing decisions (compared to 38 percent of consumers with low emotional engagement). Emotional differentiation is critical to brand success this year.

Marketers need to use the right platforms, programs, messages, and experiences to engage customers and win their loyalty. Loyalty programs are evolving beyond discounts and cash backs to special perks which add value and influence behavioral loyalty. Most of this behavior is status driven, rather than economic, and it’s imperative that brands build in additional value beyond price.

Customers with emotional attachment to a brand will choose that brand over a cheaper, more convenient competitor. How can emotional loyalty be achieved? By tapping into who your customers are and what’s important to them and building a brand that represents their lifestyle and passions. For example, ASUS, the #2 gaming hardware company, recently launched their Republic of Gamers Elite Rewards loyalty program which has been designed to be authentic to the passions of their customers. The program incorporates gamification as fun way to engage and earn points. Members are rewarded for participating in gaming competitions and for visiting the ASUS booth at major gaming events and conferences. The brand is helping to build a community for their customers and creates value that’s more emotionally charged than purchase driven.


2018 is all about meeting customer expectations with sophistication including effective use of data to drive relevant communications and promotions, and understanding consumer values and passions.

Brands need to evolve their loyalty strategies this year to drive stronger engagement and loyalty from customers.

Learn more about the trends and technology impacting loyalty programs in 2018 here.

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