Attracting and winning customer loyalty is one of the leading priorities for brands across every industry. Many loyalty programs succeed simply because almost everyone loves to be rewarded and feel appreciated. This acknowledgement, and the emotional connection it can generate, is among the primary benefits of a loyalty program.
Most businesses are increasingly embracing this approach to customer engagement. But striving for this goal is one thing, achieving it is another.
This appears to describe the situation of many banks across the UAE’s financial industry.
Earlier this year, the Collinson Group, a leading global market research and customer engagement agency, found that making investments in loyalty and other customer engagement initiatives was a top priority of most UAE financial executives.
However, the Collinson Group recently found that a very large majority (72%) of UAE middle class consumers reported being unsatisfied with the loyalty programs of their respective banks. Specifically, these consumers believed that the benefits were lacking, and viewed the rewards as either uninteresting or unattainable.
This is not to say that UAE banking customers were dissatisfied with their banks overall. This dissatisfaction appeared to only extend to the loyalty programs. But for institutions in such a highly competitive industry, pleasing customers on this front could provide a strong competitive edge.
"Whilst the majority of customers in the UAE are satisfied with their banks, the emergence of alternative providers of financial services and the number of customers on more basic bank and credit card services, highlights the opportunity to retain and grow a portfolio of services with those within the top 10-15 percent of income,” said Mark Roper, Collinson Group Commercial Director. “Customers see their accounts as a necessity but don't feel they offer additional value or reward. Our research found that not being rewarded for loyalty is the biggest frustration for consumers.”
This was the leading concern among UAE banking customers. In fact, loyalty program dissatisfaction was seen as a bigger issue than poor interest rates and unnecessary fees.
Furthermore, almost two thirds of UAE customers said they do feel a higher degree of loyalty to banks that do offer more relevant and attainable rewards.
“As a result, retail banks and credit card providers in the UAE are missing out on the opportunity to create powerful advocates and attract repeat business from loyal customers,” the Collinson Group concluded.