A new survey by Apadmi, has found that the majority (67 per cent) of businesses expect investment in digital loyalty to increase or significantly increase over the next 12 months.
The second annual Digital Customer Loyalty report, also revealed that 81 per cent 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 per cent) of businesses said they are currently developing a digital loyalty programme, while 35 per cent stated they already have a live digital loyalty programme in place. 13 per cent said they plan to create one in the future, while less than 1 per cent admitted they no longer use a loyalty programme. This highlights the importance brands are placing on their digital loyalty strategy.
Almost a quarter (24 per cent) 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 per cent) and a cost-effective way to reach customers (40 per cent) top.
Thinking about the tactics used, 81 per cent 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 per cent 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 per cent), up from 40 per cent in the 2024 report. Future tactics perceived to be less popular included paid membership ( 19 per cent) and scan-and-go (15 per cent), both of which declined by nearly 10 per cent 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, commented: “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.
“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.”
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