‘Majority of major brands’ expect increased investment into customer loyalty
A survey has found the majority (67%) of businesses expect investment in digital loyalty to increase or significantly increase over the next 12 months.
Apadmi’s second annual Digital Customer Loyalty report, also revealed that 81% of respondents consider loyalty to have always been important or is now more important than ever, with the number one business challenge being solved by digital loyalty programmes being frequency of purchase.
More than a third (36%) of businesses said they are currently developing a digital loyalty programme, while 35% stated they already have a live digital loyalty programme in place. 13% said they plan to create one in the future, while less than 1% admitted they no longer use a loyalty programme. This highlights the importance brands are placing on their digital loyalty strategy.
Almost a quarter (24%) of respondents believe apps are the most responsive CRM channel they use, with mobile apps becoming the preferred channel of choice for customer loyalty initiatives.
When considering the key functions mobile apps play in loyalty programmes, brands ranked the delivery of a more personalised experience (40%) and a cost-effective way to reach customers (40%) top.
Thinking about the tactics used, 81% of respondents said personalisation is a key part of their mobile customer engagement strategy. However, a quarter admitted they only have basic personalisation implemented, or have yet to implement it at all.
Mobile continues to make personalisation a more seamless and effective tool for brands looking to keep customers engaged, whilst also delivering value to customers who expect relevant, convenient content, services and products to be served up in the palm of their hand.
Clearly, appetite for personalisation remains high, with brands suggesting that there’s still room for more. In fact, compared to 2024, there’s been a 10% rise in businesses planning to increase personalisation efforts.
When it comes to the future of loyalty tactics, businesses are already considering where they may want to invest further in loyalty in the future. Topping the list was exclusive offers (49%), up from 40% in the 2024 report. Future tactics perceived to be less popular included paid membership ( 19%) and scan-and-go (15%), both of which declined by nearly 10% year-on-year.
Compared to last year’s results, it appears that more brands want to start focusing on exclusive offers, loyalty points, instant wins and exclusive pricing; trends already being witnessed with Apadmi’s clients.
While the appetite for digital loyalty programmes is clear, the biggest barriers for respondents were budget restrictions, lack of clear strategy, other areas being given greater priority, and a lack of internal expertise.
Instead of letting these challenges hold back growth, brands should find ways to show value quickly. For example, creating proof of concepts, using fast follow features, conducting user research, and testing features with small groups of customers.
Jake Sargent, Group Marketing Director at Apadmi, said: “Businesses across all sectors are feeling increasing pressure to acquire, engage and retain customers in increasingly competitive markets. Rising living costs for customers and business costs for brands means retaining and engaging loyal customers is essential to safeguarding retention and revenue, with the need to create more efficient and effective loyalty programmes and experiences greater than ever. Our research has highlighted how digital is shaping the world of loyalty, providing a view on the impact these experiences, particularly mobile, are having on loyalty. An increased focus on personalisation, product and programmes to drive customer and business value is what we’re likely to see more of in 2025.”
Emma Collins, Head of Loyalty and Engagement at Poundland, said: “We had to work really hard to lay the groundwork for our new programme, Poundland Perks. That meant getting buy-in from all internal departments, including our fantastic stores – championing the results of our invaluable testing and learning. Loyalty is about finding a way to create insight, increase personalisation, drive footfall and invite conversations. And the best channel to do all of that at scale is digital, which is why we went mobile-first.”
