A glimpse at India’s loyalty landscape

26 March 2013
Collinson (formally ICLP) recently attended and sponsored the Loyalty Summit, a 2-day conference in Mumbai, India. The strategic loyalty marketing event is now in its 6th year and brings together multi-sector B2C brands to focus on customer engagement and loyalty marketing strategy.

Following our attendance and speaking session at the event, we share some key take-aways from the conference and offers some insights into loyalty in India.

The Loyalty Summit

As the only dedicated event for loyalty marketers in India, the Loyalty Summit was attended by loyalty practitioners, CRM, Social Media, eCommerce and technology specialists. It was really encouraging to see that brands from the public sector such as BPCL, HPCL and ACC were present together with private players like Jet Airways, Dish TV, Shoppers Stop etc. The conference also drew some new younger companies like Games 24X7 and Fun Cinemas who stand out with their customer engagement programmes. The summit brought together varied industry experts covering retail, telecoms, logistics, travel and entertainment.

State of the industry
Loyalty in India is still quite fragmented, with the differences between engagement strategies, acquisition strategies and pure play loyalty programmes still not fully understood. However some pioneering brands are leading the way with engagement strategies and loyalty programme launches,so brands and customers are progressively increasing their understanding around the advantages. Instant benefits are the order of the day with loyalty programmes in India and several retail (Hypercity, More Supermarkets, Aditya Birla Group) and telecoms players (Airtel and Vodafone) now driving the market in this direction. Indian consumers are also now ready to pay to be enrolled into an appropriate loyalty programme which previously was not the case.

Technology plays a big role in delivering next generation loyalty programmes in India. These programmes are built on new mobile and social media platforms. With India’s core population within the 18-35 year age group, these new technologies have flourished and brands want to build on this momentum.

A good example is a frozen yogurt company who are using mobile devices to sign in customers as they walk into their store and offer them instants points on their purchase. On completion of 12 transactions, the 13th transaction is free for the member. The highlight is not that the 13th transaction is free but the fact that the programme has instant enrolment on a mobile device – which also creates excitement and engagement with the walk-in customers.

Social media is also being used significantly to drive customer engagement and loyalty in India. Almost every brand now has a social media strategy and you see more and more offers and promotions being delivered through social media channels. The importance of developing consumer communities is becoming more prevalent through either social media or other engagement techniques. Communities can foster strong brand advocates and become a medium for customer acquisition and ultimately brand loyalty.

Many organisations are also talking about 360° loyalty – not restricting loyalty just to the customer level but looking beyond to inspire loyalty in your vendors, employees and distributors – which will ultimately influence customer loyalty.

Beyond today
In the last few years brands in India have taken baby steps towards creating customer affinity and customer reward programmes. It is becoming increasingly important to really develop and invest in established customer engagement and loyalty strategies. The market is slowly evolving, customers now understand the principles behind loyalty, there is technology now available for brands to implement even basic loyalty points engines to facilitate efficient programme set-up and launch.

A key challenge is for those organisations who don’t have designated in-house resources for loyalty management as the focus remains on core business strategy.