Brands with futuristic vision have hopped on the mantra of holistic loyalty to unlock long-term benefits. This blog covers the trends that became a mainstream strategy in the loyalty software market in 2022 and some promising trends for 2023.

1. LOYALTY INSIGHTS FROM 2022 & PROMISING
TRENDS FOR 2023
Brands have realized the new ground reality of customer behavior which amplifies the
importance of data analytics and strategy.
72% of customers recommend brands having good loyalty programs. In addition, brands
with futuristic vision have hopped on the mantra of holistic loyalty to unlock long-term
benefits. Below are the trends that became a mainstream strategy in the loyalty software
market in 2022:

2. Trends that Defined the Existing Wave of Customer
Loyalty
1. Hyper-personalisation of loyalty programs
In a survey, personalization was ranked as the top factor for boosting customer
engagement for the next 5 years. As a result, 2022 saw a significant increase in brands
adopting a data-driven approach to design loyalty programs.
Radisson Hotel Group revamped its loyalty program with unique perks and high
customizability of choosing rewards. Here are more features of the loyalty program:
■ Members can redeem 325 points to make their hotel stay carbon-neutral.
■ Discount booster allows customers to boost their discounts for future purchases.

3. 2. Brands utilize gamification to engage customers
Gamification is a proven way to drive customer engagement, with gaming audiences
increasing rapidly. Additionally, 81% of loyalty program members like to engage with loyalty
programs having a gamified experience.
Fitness Rewards by Strava has taken gamification to the next level. Creating a leaderboard
of participants and curating experiential rewards for members who complete challenges
makes the loyalty program compelling.
3. Introduction of cryptocurrency and NFTs as loyalty rewards
With the web3 revolution on the rise, cryptocurrency and NFTs are painting the future of
loyalty programs. Since NFTs are unique and highly valued, brands have included them in
rewards to develop appeal and differentiate themselves.
Starbucks Odyssey has included digital collectibles as rewards for customers completing
challenges and participating in brand engagement activities. Furthermore, the digital
collectible gives members access to previously unavailable experiences and coffee
workshops.
4. Strategic partnerships between brands
A constant challenge for brands is to stay ahead of competitors and engage customers for
maximum time. Partnering with brands opens new opportunities to engage customers in
multiple ways. Also known as the Coalition program, a partnership is a core element of a
holistic loyalty program.
For example, the World of Hyatt loyalty program has partnered with American Airlines to
offer reciprocal earning of loyalty points. In addition, it provides a chance to earn points on
stays, spa services, and hotel dining with its partner brands.
5. Perks that surpass the efforts
Data analytics has enabled marketers to understand customers and stay ahead of their
expectations. As a result, marketers can curate rewards that outweigh the efforts needed to
earn them.
Virgin Atlantic allows its loyalty program members to redeem rewards and get one day flight
without fear, course with experts. A one-day experience to understand every movement,
squeak, and wobble through training and flight experience with just your earned loyalty
points.

4. 6. Empathy a driving force
Empathy has been a driving force in forging long-lasting customer relationships
Building a community of loyal customers with similar interests allows members to make
empathetic connections and boost brand advocacy.
Sephora’s loyalty program members get access to an online community – ‘The Beauty
Insider.’ Members can ask questions, swap advice, and get event updates to get their
answers.
Keynotes from 2022 Loyalty Programs
■ Instead of focusing on each transaction or segment of the customer journey,
brands focus on the entire omnichannel experience.
■ Customer behavior never stops evolving, but the impact of an emotional
connection through rewards beyond cashback can go a long way.
■ Including social causes in loyalty programs shows the shift in marketers’ mindset
that focuses on empathy for everyone.
While 2022 has been a year of market resurrection for brands post-pandemic, 2023 will be
the year of adaptation, and agility. Let’s go through the trends defining the customer loyalty
market next year.

5. What to Expect from Loyalty Programs in 2023?
■ 80% of Millenials & 75% of baby boomers prefer earning rewards through
engagement activities having excitement as an element. Nike created a virtual
reality game called Reactland, allowing members to play and share the experience
with social media to gain exclusive rewards. Going forward, achieving customer
engagement will demand more creative ways.
■ Brands go the extra mile in rewarding the highest-tier members. In 2023, loyal
customers will play a crucial role in the brand’s product releases, policies, and
vision. This year, Target launched ‘Target Circle’, with personalization and
exclusive perks, allowing members to choose where Target should spend its
charitable funds.
■ Customers are not going to wait to redeem rewards. In loyalty programs, instant
gratification will become a norm. For example, 84% of customers felt better when
they could instantly get rewards for actions performed.
■ Omnichannel experience and a holistic approach towards loyalty programs will
become a necessity. 87% of Gen-Z want loyalty programs to be accessible

6. everywhere. In-store and online store experiences will become unified and
seamless with brands leveraging technology platforms.
■ Third-party data has lost its value. Marketers realized that zero & first-party data
are the new frontiers of personalization and customer experience. Loyalty
programs fetch this valuable data helping in curating precise strategies and a
customer-centric loyalty program structure.
Summary
Going forward, data alone will lose its worth. Analytics becomes the key to unlocking
insights. A robust technology platform is needed to match customer expectations.
Marketers can ride the next wave of loyalty with data analytics that tells them different
things about customer behavior, a futuristic tech stack that equips them with features
necessary to offer better customer experience, and the right strategy to connect with
customers for building long-lasting relationships.
Ultimately, a holistic approach where these fundamental essentials work together will
become the lightsaber for loyalty leaders.