Loyalty360 has seen that many brands are substantially restructuring their loyalty programs or launching new ones altogether. These trends suggest that something serious has changed. To get a grasp of this change, we spoke with Christine Bardwell, Global Product Manager of Strategy at Oracle. The tech company has released a new whitepaper that examines major trends in the loyalty space. The report also makes evidence-based predictions for the future of the industry.
Bardwell first discussed the changes she has seen taking place. “There’s definitely a shift,” she said, “and I think it’s twofold. You’ve got the smaller brands and the larger brands that already have successful programs, and if you look at, not necessarily smaller brands but brands that have maybe smaller loyalty programs, they’re the types of brands that set up their loyalty programs, because that’s what their competitors did, because they thought it needed to win.”
She continued, “I think they had the mindset, ‘build it, and they will come,’ and I think that was probably true for a while, but that time is long gone now, so these brands have done all they can do to compete in other areas of their business; they’re differentiating themselves in their industry; they’re focusing on their bottom line. Now, what they’re seeing is that customer experience has become one of the remaining points with which they can differentiate the heart of their business.”
Bardwell believes that experience is now the key differentiator. It’s a simple concept, but it has massive implications for brands. One such implication is rewards for, as Bardwell put it, “positive behaviors.” We’ve seen brands offer rewards for engagement on social platforms. According to the Oracle team, rewards for such engagement are going to increase, as will more creative rewards for a whole range of behaviors that benefit brands.
In that vein, Bardwell noted the trend of brands creating “fanbases,” consumers who advocate the brand to their peers in engaging ways, and introduced the concept of “nano-influencers.” These are people who have “up to 5,000 followers” online. Bardwell said, “They’re not one of these bloggers or bigtime influencers. These are people who are more like most of our kids, teenagers, who probably have around 1,000 followers on their Instagram. It’s these people that have a huge amount of influence on their close network. Product recommendations in those networks can be extremely powerful.”
The days of the big-name, paid influencer have reached their peak, and now is the time for humbler influencers. That’s what Oracle has forecast. The logic makes sense. Now that major influencers are often perceived as commercial, the teenager on Instagram has something more authentic to offer.
It will be interesting to see how these changes manifest. The rise of “fanbases” presents a tremendous opportunity for brands, but there’s a serious challenge involved. This is new territory, so the brands that differentiate themselves the most are going to have to be pioneers.