E-COMMERCE(1)

Loyalty and e-commerce: The race is on

By in Media, Communications, Marketing on February 29, 2016

According to a new study from Juniper Research, 1.4 billion loyalty cards were mobile-only or integrated into mobile apps in 2015 worldwide. The research forecasts this will rise to 3 billion by 2020.

Dr Windsor Holden, author of the research, says the disparities between loyalty schemes “are likely to result from a number of factors. While in part they may reflect the level of satisfaction with the app and, or the features it offers, they may also be attributable to a greater degree – or greater success – of retailer marketing of their digital loyalty options,” said Holden. He added that those retailers who do not offer mobile integration of their loyalty schemes were likely to have “far lower levels of visibility on consumer activity”.

Locally, brands have woken up to the race to be mobile-ready, seeking ways to make their customer’s lives better and entrench them deeper into the brand. The problem in pulling these gears is the strategy to ensure that the loyalty scheme is simple, engaging and accessible. The previously adopted format was the traditional loyalty card but that only met one of the criteria – simplicity. The move to mobile injects engagement and the “always on” component due to our love of the cell phone. The problem with the old card-based loyalty system is that they’re relatively costly, customers don’t immediately know what their balance is, and cards are easy to lose.

Previously a card-based platform, now app-based, South Africa’s Vida e Caffe app facilitates mobile purchases but is a mobile, virtual loyalty card, that accumulates points for cash and mobile payments.

Explains Darren Levy, CEO of Vida e Caffe, “Knowing that a mobile phone is the one thing that just about everyone has on them all of the time we decided to take our loyalty programme mobile. To do that we partnered with wiGroup, local mobile transaction and loyalty experts. Our focus was on simplicity and accessibility. As you walk into one our stores you can use our free wifi to download the Vida app, sign up, input in your credit or debit card details and click ‘Pay’ to choose one of the payment methods, such as using your mobile, using your loyalty balance or paying as usual with cash and still earning loyalty in the app. Then all you have to do is hold the QR code screen in the app up to the scanner on the till terminal and wait for the beep. You pay and you earn instant loyalty which you can use at any time.”

Vida have taken it a step further to allow for gifting. Users can Share the Vida Love with a friend by sending them a voucher from within the app, and still earn loyalty. “It’s a great way to connect with someone, especially on a birthday or special day in the calendar. The uptake has been fantastic,” adds Levy.

“At Vida, it’s not just about developing an app, it’s all about engagement. As a business we get to instantly connect with our customers, distribute deals and offers, and understand what they like most so that we can deliver the best possible experience to them. We’re focused on the creation of value and we use the app to help our customers access and unlock that value in a number of ways. Loyalty is super important to both the brand – and its customers. If the coffee shop you most frequent doesn’t offer you loyalty rewards, you’re not in the right coffee shop!”