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Consumer Packaged Goods (CPG) or Fast-Moving Consumer Goods (FMCG) customer loyalty programs face unique challenges in the loyalty market today. Largely, CPG brands are scooped up into larger retailer programs, which then own the customer data, as well as the specific offers. For the CPG brand-owned programs that are finding success, the onus is still on customers to track their purchases (e.g. scan receipts or to enter on-pack codes) in order to participate. There are recent outliers, such as Dollar Shave Club and Schiff Rewards, that have a direct online channel to their customers, which helps automate purchasing decisions and data collection.
Today, Australia and Dubai both lack strong CPG program presence. In the US, program constructs largely require receipt scanning or code on package entering on the brand’s website or mobile app for rewards and experiences. The direct to consumer products include beauty, food, health, baby and lifestyle. Tiered programs within the beauty industry can unlock higher value freebies, free shipping, consulting, etc.
UK programs are largely promotion-based, with some larger CPGs having programs consistent with their US counterparts (i.e., Pampers) with some receipt scanning, little tiering and use of partners for redemptions.
APAC’s CPG programs are limited to beauty, baby and personal care products with some tiering with bonus points or graduated discounts. Outlier baby brand Wyeth China created a 24/7 community (enabled through WeChat) for mothers connecting for problem solving and support.
Aimia’s recent emotional loyalty study reviews these loyalty trends to uncover what engages consumers (rational) and what consumers expect (emotional) from loyalty programs. Looking at the consumer needs and wants helps to uncover opportunities for program improvement and areas where brands can truly differentiate.
According to the study, Rewards was largely the primary driver for rational loyalty in the ideal program. The UK (41%), Dubai (31%) and APAC (35%) all saw Rewards as the primary motivation for loyalty. The US was an outlier with 36% of loyalty driven by Preferred Treatment, and Australia with Customer Data & Service at 38%.
Rewards was also the primary indicator of emotional expectations. APAC consumers had the highest expectations at +58% above the mean, followed by the UK with +50%, then Dubai with +46% and the US with +37%. Australia was the outlier here with highest emotional expectations in Customer Data & Service (+43%).
Rewards is still the king when it comes to CPG loyalty. For the effort consumers put in for their CPG programs, they are expecting rewards that make them feel truly rewarded and valued. Brands looking to differentiate their programs should design a construct easy to participate and that offers a range of relevant rewards consumers can get excited about. Some beauty brands in the US are doing this, like MAC whose points-based program allows members to get free merchandise and exclusive event invites, as well as other rewards. Ease of use for CPG may also move programs beyond rewards – subscription programs based on your consumption will provide not only recurring revenue for the brand, but also lighten the cognitive load on consumers who need to order and pay for these staples on a regular basis.
Customer centricity is key to differentiation among a crowded loyalty landscape. Aimia uses its proprietary SmartJourney® methodology, taking a holistic and personalized customer-centric approach, where each brand interaction is designed to create a meaningful moment and ultimately drive emotional advocacy and long-term customer growth.
The data in this article is derived from Aimia’s emotional loyalty market research report, Global Emotional Loyalty. Download the full report here.
Ease & Participation: Ease of use in joining and participating in the program, and processes within the program such as gamification and recognition
Customer Data & Service: How much data is exchanged for program benefits and data security; general care for the customer
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