In the realm of loyalty, a brand’s success hinges on consumers’ consistent engagement with its programme and decoding the best loyalty strategy to increase consumer connection. A well-considered proposition – one that incorporates a compelling call to action, encourages active interactions, and directly addresses consumers’ pain points – helps boost customer retention and captivates newcomers, fostering deeper engagement.
Point-based and tiered programmes continue to dominate the loyalty space
Based on the findings from Euromonitor’s Loyalty Brand Tracker 2024, point-based and tiered programmes continue to dominate the loyalty space.
77% of the 100 tracked brands offer points, compared to 59% which have tiers
Source: Euromonitor’s Loyalty Brand Tracker 2024
Unsurprisingly, mass-market consumers traditionally associate loyalty benefits with the ability to redeem loyalty points for discounted/complimentary services or offers, which shapes the types of rewards provided by these schemes today.
The third most popular feature is related to experiential rewards, with 49% of the brands incorporating that as part of their loyalty structures, followed by partnerships and omnichannel coverage. The latter, ranking only fifth as part of Euromonitor’s data, highlights the need for these programmes to embrace more versatility in order to deliver comprehensive customer engagement and seamless experience via both online and offline channels.
Overall, traditional loyalty schemes, which tend to have more transactional offers, overtake the next-gen propositions among the select 100 brands in Euromonitor’s Loyalty Brand Tracker, with 58% of the players relying on these, versus 43% for next-gen types of schemes.
Euromonitor loyalty consumer segments: Preferences and behaviour
As part of Euromonitor’s Voice of the Consumer: Loyalty Survey, three key consumer cohorts are identified: Loyalty Novice; Loyalty Explorer; and Loyalty Enthusiast. The results of the 2024 survey (fielded March to April 2024) highlight that, based on the preferences of the consumers, the most effective loyalty programmes must facilitate convenience and incorporate experiences to give members the most value. Loyalty enthusiasts, in particular, favour experiential rewards, while loyalty explorers focus more on the importance of a seamless customer journey, and loyalty novices will subscribe to 1-2 paid schemes to enjoy exclusive and diverse rewards.
The results from the Q2 2024 Engagement Index of our Loyalty Competitor Tracker illustrate how successful top 100 brands have been engaging with their consumers over the quarter, by tracking app downloads and web traffic performance and comparing this to the industry average.
Higher values recorded by a brand reflect more consumer interactions with the individual player and their loyalty programmes, and ultimately a better overall performance of their websites. Q2 2024 Engagement Index results point out a diverse mix of players in the top 10 ranking with a dominance of players from the travel industry, which is among the most established in terms of loyalty programmes with a strong loyalty participation rate by consumers. The success of these schemes is due to their large membership and established partnerships, especially in segments such as airlines, hotels and OTAs, categories which are projected to continue to see growth in 2024.
Booking.com leads in terms of Engagement Index performance and two out of the three best performers are in the airlines segment – China Southern Airlines and Emirates Airlines. With exceptionally high average web visit duration and daily and monthly visitors to the website, Booking.com stands out from the list of 20 top travel players in the world with a 165.2 Engagement Index result, which helped position it at the top of the list. China Southern Airlines showcased high performance in terms of unique visitors for the period, while Emirates Airlines had the second lowest bounce rate at 29.3% among travel companies for the quarter alongside strong web visitor numbers (28 million) for that quarter.
Travel seasonality is directly linked to the fluctuating number of app visitors and average app duration for these brands, which also includes the research and planning (booking) stages of upcoming travel. This explains the high performance of these travel companies based on the select parameters. Having a fast and optimised app, which is customer-centric and provides personalised experiences supported by good navigation and ease of searchability for flights and other services, and overall useability further help cement the high performance of these brands.
Benchmark against your competitors
To thrive in the loyalty landscape, businesses must focus on more than just building a large customer base. They should intensify their efforts to enhance customer engagement in alignment with their focus on loyalty as a strategic priority, ensuring the overall effectiveness of their strategy. To drive engagement, brands must provide a diverse array of incentives and services that foster more opportunities for repeat interactions with loyal customers.
Consumers are closely monitoring what brands in their markets are doing, seeking out those that understand their needs and values and provide the most appealing loyalty rewards. In this environment, staying connected with consumers and analysing competitors' offerings enables brands to gauge industry trends and adjust their strategies.
Read our report, The New Loyalty Playbook: Strategies from Leading Brands, for more analysis on brand loyalty.