The business world, struck by a financial crisis and a looming recession, is facing an uncertain future. But even in such a turbulent economic climate, customer loyalty can be the way out. But how can organizations invest in a loyalty program to ensure a high return on investment? How should you allocate your budget? What loyalty program trends and benchmarks should you look out for?
Antavo’s Global Customer Loyalty Report 2023 is a guiding light for businesses that want to invest wisely in their loyalty programs, so that their efforts pay back… not just to their organization, but also to customers and the world itself!
Everything You Need to Know About the Global Customer Loyalty Report 2023
Following the success of the GCLR 2022, this year’s report provides an in-depth analysis of the current loyalty program landscape, a breakdown of budgets and team composition, the technology preferences of current and future loyalty program owners, as well as a forecast of the top loyalty program trends for the next three years.
It’s meant to help businesses make informed decisions on how to invest in customer retention and loyalty programs so they can achieve a high ROI, satisfy customers, and even support noble causes.
The information is based on:
- More than 290 million anonymized member actions tracked via the Antavo Enterprise Loyalty Cloud
- Over 600 minutes of qualitative interviews with renowned industry experts
- Data from over 260 corporate survey respondents from all regions of the world
The Current Loyalty Program Landscape
During the Covid-19 pandemic, loyalty programs proved to be a critical customer retention tool. But how are they perceived now, during the current economic crisis, and what are current loyalty program owners’ priorities?
We learned the following:
- 55.9% of companies view the role of customer loyalty as essential to overcome the inflation crisis and a potential recession.
- 88.5% of respondents trust loyalty programs to help them overcome the inflation crisis and potential recession.
- 67.7% plan to increase their investments in customer retention in the inflation crisis and potential recession.
- 78.6% of respondents with an existing loyalty program are likely to revamp their loyalty program in the next three years. This is a seven percentage point increase over last year.
- 80.0% of companies who measure the ROI of their loyalty program reported a positive ROI, earning 4.9X more revenue than what they spend, on average.
How to Invest to Ensure a Successful Loyalty Program
Results indicate that loyalty programs can easily generate revenue for companies—but they have to be executed well. In other words, organizations should spend their time, human capital and budget wisely, and pick a technology that’s capable of turning the company’s vision into a reality.
Loyalty program insights regarding the management teams, budgeting and technology include:
- On average, 16.2 people are actively involved in loyalty program management at their organizations, and 40.7% of businesses have a dedicated loyalty team leading the loyalty program, composed of employees from various departments.
- 28.2% of organizations’ total marketing budget goes to customer loyalty program management and CRM—a 5.4% year-over-year increase.
- 61.0% of respondents whose loyalty program is managed by a loyalty technology solution vendor are satisfied with their program, while 51.1% of respondents whose loyalty program is managed by in-house technology are satisfied.
Opportunities for Launching & Revamping a Loyalty Program
Introducing or re-introducing a loyalty strategy requires a solid business case, well-defined objectives, a clear forecast of the ROI, reliable technology, and, of course, expertise.
Here are our key findings:
- On average, the companies surveyed have invested or plan to invest $375K USD in the launch or revamp of their loyalty program.
- 52.6% of future program owners said they will handle technology-related changes together with an outsourced team, like a third-party technology vendor.
- 71.4% of program owners who have revamped their loyalty program in the past two years are satisfied with their new programs.
- 7-13 months is the amount of time needed for 49.0% of respondents to revamp their loyalty programs.
Top 3 Loyalty Program Trends for 2023 and Onwards
In order to provide practical insight into the landscape of loyalty programs in the next three years, survey participants were asked to rate the importance of a series of loyalty trends and features, including ‘buy now, pay later’, card linking, NFTs, and more.
- Strategic partnerships/partner rewards: The biggest benefit of this loyalty program trend: creating a unique loyalty experience. The biggest challenge in adoption: finding the right partner.
- Card linking: The biggest benefit of this trend: gathering rich customer data. The biggest challenge in adoption: the complexity of implementation.
- Supporting ESG causes (sustainability, buying ethical products, charity, etc.) through a loyalty program: The biggest benefit of this trend: aligning the brand with the values of customers. The biggest challenge in adoption: identifying the right cause.
Loyalty Pays Back!
Keep in mind that this is just the tip of the iceberg. The full report not only has more stats, but also breaks the data down into actionable insights on how to future-proof your business. Moreover, the report features a section dedicated to industry benchmarks for loyalty program KPIs.
If you feel ready to make the next step and push your company’s loyalty strategy to the next level, the experts at Antavo are more than happy to showcase how our technology can help. Just book a demo or send us an RFP.
And if you haven’t already, make sure to download our Global Customer Loyalty Report 2023.
