Having an outstanding and forward-looking loyalty program is a must for businesses in this highly competitive environment. Turning customers into fans is the ultimate goal for those seeking to secure a significant market share while delivering the “wow!” factor for their customers.
Today’s conversation features Mladen Vladic, VP of Loyalty Operations at FIS, and Daniel Keyes, Senior Analyst of Merchant Services at Javelin Strategy & Research, as they explore the post-pandemic trends of the payments landscape, the implications, and how loyalty programs can evolve and continue to deliver first-rate service for their customers.
The Changing Face of Payments Solutions
If the pandemic has taught us anything, it’s that customers demand more contactless and seamless payments solutions. During the pandemic, consumers were rightly concerned about their health and were disinclined to engage in payment forms that they believed could expose them to the virus on contaminated surfaces. Safety and cleanliness were at the forefront of consumers’ minds, and contactless payment methods surged as a result.
Aside from the surge in contactless payment solutions, other shifts took place, such as the demand for faster payments. This new era, beyond the onset of the COVID-19 pandemic, ushered in a growing interest in digital currencies.
“The pandemic was a true catalyst to shift to the truly holistic digital approach that most of the brands out there today are embracing,” Vladic said. “The other big trend that I would say is the focus on real-time payments and the acceleration of that trend once to better service customers. The fact that the central banks around the globe are getting more serious about digital currency is another trend that is going to further accelerate.”
Vladic also noted that by 2025 80% of the world’s population will have access to smartphones, providing a growth opportunity for the payments and banking industries. This will be especially profound for the unbanked and underbanked by expanding financial inclusion.
“Acceleration is the keyword,” Keyes said. “The pandemic packed years and years of changes and developments into a very short period of time. Every trend you mentioned was already happening before the pandemic, but it was going to take seven, eight, 10, 15 years to get to where we are now.
“Now that things are slowing down pandemic-wise, we’re left to pick up the pieces and see what happens when you skip seven years in the process of contactless payments and RTP digitization. It’s never going to slow down. We must keep going with where we are.”
The Synergy of Loyalty and PaymentsEdge Solutions
When it comes to integrating new solutions, nothing is more cost-effective and convenient than having various solutions on one platform. With the loyalty division and the FIS PaymentsEdge marketing solutions working together, clients get the best of both worlds and then some.
“There’s a tremendous opportunity of two businesses within the loyalty within the FIS payments division, in terms of synergistic potential when it comes to the value that we can bring for our clients,” Vladic said. “I truly believe on the highest level, on the macro level, that they complement each other.
“I think about loyalty as a long-term engagement value-add tool that is there for the customer on an ongoing basis. It’s really a long-term basis, three to five years. And then I think about PaymentsEdge as a series of this well-packaged, well-executed mini-campaigns that are truly focusing on optimizing card portfolio performance for the issuer.
“There’s a consulting layer on top of that. That makes the FIS payments solutions suite even more compelling for the issuers because it has all of the different products and services that can help with issues with the lifecycle from the acquisition to activation, usage, and retention.”
Said Keyes: “There’s plenty of value in offering the number of solutions that address different areas that are ideally integrated on the same page. That can really benefit various clients in a lot of ways.”
Innovative Loyalty Program Solutions
For a loyalty program to hold relevancy for consumers, certain consumer pain points must be addressed. Among these are the ease of redeeming points and the receipt of targeted, personalized communication recommending specific, relevant products and services.
Anything that impedes customers is something to be rooted out, Vladic said.
“I believe removing the friction is the number one objective for any loyalty scheme,” he said. “We were able to identify the way to make that redemption experience for cardholders that much cleaner, intuitive, real time, and compelling. The traditional redemption experience is comprised of sending cardholders the marketing, content, marketing message to either website or the app.
“We developed the network of merchants, where cardholders by simply paying with their payments card are presented with an offer in real time to redeem their loyalty currency in real time for discount at the point of sale.”
Too many steps in taking advantage of a loyalty program hurt customers’ relationship with a brand, Vladic said. By including offers at the point of sale, consumers are given the choice to take full advantage of the company’s offer without having to sign up with a password on a website or app.
“I just want to hit home how important removing friction is for loyalty,” Keyes said. “You know when a consumer is making a first purchase at a merchant and there’s friction on the way to the end of the purchase, that’s frustrating. But the consumer wants to complete that purchase. They already picked out an item. They might power through for loyalty.
“It’s very easy for consumers to bounce off. Having no friction or having as little friction as possible is really important for loyalty because otherwise nothing you do will work if it’s a choppy process.”
The Loyalty Market Continues to Expand
With advancing technology, opportunities abound to evolve and improve loyalty programs.
“These are very exciting times to be in the loyalty marketing space because there’s so much dynamic (changes) and disruption taking place,” Vladic said. “Logically, the consideration is how does the existing program evolve so that we stay relevant to the consumer and the changing expectations by the consumer in cases where the brand doesn’t have any type of engagement or the loyalty program.”
Vladic said more brands are carefully looking at their engagement and loyalty strategy, finding ways to remain top of mind with their customers.
“I’m very excited to see just making redemption of any kind of rewards or value-add easier,” Keyes said. “As far as getting it to the consumer, them accessing it, then cashing it in, with greater speed and greater ease, a lot of loyalty programs can be more effective as things become more instantaneous. I think it really benefits merchants in the end.”
