2012 Trends in Customer Loyalty and Rewards
Customers’ habits and interests changed in 2011, directly impacting the rewards and interactions they will desire in 2012. The convenience of mobile technologies triggered an outbreak of wanting everything here and now. Social gaming continued (and continues) to grow, fueling gamification’s ascent from industry buzz to implemented engagement tactic. Financial pressures brought people back to the home, and the aging population (and corresponding health care crunch) focused people on health. In response to consumer changes, customer reward programs need to adapt as well.
Here’s a breakdown of the expected trends in 2012:
The Rise of Non-cash Rewards
2012 will make strides in determining a winner for the cash vs. non-cash debate—put your cash on non-cash. More and more research shows non-cash rewards to be more effective. People visualize and remember tangible items better than cash, and therefore stay more actively engaged with program goals and objectives. In addition, customers are also more emotionally involved and willing to work hard for something perceived as a special item, rather than cash or a more practical reward. This is true even when the luxury item costs less.
On Demand and On-the-Go Entertainment
During this holiday season, electronics topped the list as the most redeemed items in rewards programs, with the top three items including the Apple iPad 2, Amazon Kindle Fire and Nike+ Sportband Watch. We will see this reward trend continue, as customers insist on staying connected to whatever and whoever they want, whenever they want it. Expect customers to want more notebooks, laptops, tablets, Internet TV, and interactive and online gaming systems.
America’s Newest Craving—Health
Consumers want to be more fit, beautiful and healthy. Inspired by the baby boomers, consumers will place more emphasis on redefining youth and beauty with increased interest in products that allow them to see the fruits of their labor. These products include performance watches with heart-rate monitors/step meters, Wii systems for exercise and healthy performance bikes.
The Comfort of Home
Time crunched and worn-out, people are nesting in new and indulgent ways, including treating themselves to good food and spirits with friends and family, taking in a movie “on demand,” or investing in tools, upscale vacuums and safety products that give peace of mind in uncertain times.
Brands Still Influence Customer Loyalty
Brands will continue to be key to the rewards people choose. Understanding how customer segments favor brands is essential to merchandising a successful awards program. From baby boomers (who favor established brands with the “Good Housekeeping Seal of Approval”) to Gen Y’ers (who demand value and performance along with clever advertising), it’s important to take a one-size-doesn’t-fit-all approach to your selection of rewards.
Game On
Consumers want more fun in the form of challenges, rewards, and “surprise and delight” tactics. Gamification (or “game science”) will answer the call in 2012, increasingly moving from trendy idea to program staple. In fact, Deloitte recently predicted gamification to be one of the top-10 technology trends in 2012; analysts expect it to become embedded in day-to-day business processes, driving adoption, performance and engagement. Based on the latest findings within the human sciences and neuroscience, game science drives higher levels of participant engagement and ultimately, leads to better business results. Participants in a “gamified” recognition, incentive or loyalty program see the difference through features on their program web sites, the way their programs are communicated and their program rules. The goal is for participants to feel they are part of an engaging, long-term journey—an enhanced and enriching experience that keeps them excited about their programs on an ongoing basis.
