Loyalty Trends in 2020: How Will This Year Be Different?

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By: Wise Marketer Staff |

Posted on January 14, 2020

We are fans of mapping out industry trends and predictions at the beginning of each year. It’s part of our mandate as the voice of the global Loyalty Marketing industry, but we recognize that our list is just one among dozens of others. So, how is our perspective for our loyalty trends in 2020 formed to make it worth your reading time?

Recently, we went through the exercise to identify key industry trends in Customer Engagement and Loyalty. A premise in our process this year was that quantitative backing to our ideas would carry more weight than just sharing our “experienced opinion”. For that reason, we drew insights from two areas of research:

We believe that how we shape the future is grounded in our perspectives about the present. Through quantitative analysis of these reports, we identified a list of observations that we grouped into 6 trends. We had the opportunity to present the list below to a private group in December and the list endured the scrutiny of some pretty smart people.

The titles in the list are somewhat cryptic, so we’ve added explanations where needed. Here’s the list:

  1. It’s not about the Toaster (recall this reward?), but it might be about the Donuts (experience):
    • Trust is becoming the most important brand attribute, so experience is trumping rewards.
  2. It’s not about the Points, it’s about Perceived value:
    • Points are not dead, but customers are seeking so much more in a relationship with your brand. Holistic planning for great CX / UX is required.
  3. It’s not about your Mobile app, it’s what you do with it:
    • The average American spends nearly 23% of waking time looking at a smartphone and has an average of 80 apps on board. Breaking through that clutter is an enormous challenge. What value will you create in your app to stimulate engagement?
  4. It’s not about the Technology, it’s about Human Capital and a dedication to execution:
    • No customer cares about our technology, they care about their experience using technology. Operations is important and people are critical to successful operations.
  5. It’s not about the Data, it’s about who Owns the Data:
    • If you don’t want the marketing arena to be “owned” by regulators, then managing perceptions around customer data is a key to success. There’s a huge leadership opportunity in play for 2020.
  6. It’s not about the Customer, oh yes, it is:
    • Thought we missed a beat ... nah! Remember the importance of building deep, sustainable relationships with your customers. Start measuring “same customer value” in lieu of “same store sales”. Most businesses are not even at the halfway mark of the customer-centric marathon.

If you seek out the core issue or root cause behind each of these six trends, you might have a sense of déjà vu.

In plain English, we’re still struggling with a lack of progress in several areas:

  1. How do we meaningfully improve customer experience to impact customer loyalty? How should brands strike the best balance between CX, incentives, and customer service in forming its Loyalty Strategy?
  • Everyone has a mobile app. That is not exciting to your customer. The question is, how can you pack your mobile app with value and utility to make it worthy of download and repeated usage?
  • Technology, while exciting through its innovation, is enabling not customer facing. The most valuable asset in your organization is the population of your customer facing employees. Isn’t is time to invest more in training, wellness, and happiness to create the best possible result?
  • It turns out that “Data is not the 'new oil'.” It’s not a resource that anyone with the budget can mine, refine, and market for profit. Data is a valuable, delicate, and sensitive commodity that should be treated with an attitude of stewardship, not ownership. If you don’t agree, then be prepared to turn over the potential of your marketing operations to the regulators and legislators.
  • How long must we endure promises of “customer centricity” as we witness a different reality play out in the market? It’s almost as if the executive suite knows what it “should do”, but can’t quite attach a stronger enough financial reason to make it a priority goal.

A pivotal moment in loyalty marketing is happening right now. It is being defined by a disruptive economy and ever-changing trends.

The most successful DTC brands formed over the past two years were inspired by founders with a “personal connection to the problem space”. These brands solved a problem or found a way to serve a previously undetected demand.

How can we leverage the lessons witnessed by the successful disruptors in the economy to have a similar impact in customer loyalty strategy? We’ll take a stand and say that we need to forge a personal connection with our customers to understand their needs and changing attitudes. We can then redefine how and why we work to adapt our customer marketing efforts to engage the digital generation.

When we surveyed a handful of predictive trends lists for the 2020 loyalty industry from other sources, we found lots of overlap. If it’s not too passé to create a tag-cloud to express our findings from all these lists, ours would include these words (listed alphabetically) in the largest font-size:

  • Artificial Intelligence
  • Corporate Social responsibility
  • Customer Engagement
  • Customer Experience
  • Emotional Loyalty
  • Flexibility
  • Gamification
  • Immediacy
  • Lifestyle Loyalty
  • Mobile payments
  • Partnerships
  • Personalization
  • Relevancy
  • Transparency
  • Trust

None of the words on the list are “wrong” or out of place. Many are related or interdependent. Some are directional, but not useful on which to build strategy. The one unifying element of all the words on this list is that they have been mostly on “the list” for the past 2-3 years.

The reason they stay on the list is they are all important in some way for marketers to take into account. If you notice that not much new has been added, its probably because we are all still on a journey to execute well on the challenges we already know about.

Recall: 30 Highlights From 2019 to Guide Your Loyalty Strategy in 2020

The biggest question we have for 2020 is what it will take to create a “tipping point” that closes the gap on some of the challenges cited and that actions substantial and noticeable change in customer marketing.

We’re still comfortable with our loyalty trends in 2020 list at the top of this post, but rather than battle over words, we want to create improvements. That is the journey we are on as 2020 gets into gear. We want to catch up to our customers and find ways to transform concepts into actionable and measurable marketing strategies.

Stay with us as we seek to identify those tipping points.

View our new article as a panel of loyalty marketing experts share their insights into different trends that could flourish in 2020.