How do loyal UAE customers behave?
What earns and retains loyalty ?
Given UAE customers’ needs, do local loyalty programs accurately reflect what matters most?
In this year’s survey, product quality emerged as the top factor inspiring loyalty among UAE consumers. Value for money, customer service and product consistency all place second. Could it be that some brands and retailers overcomplicate their customer loyalty propositions instead of focusing on the fundamentals?
The paradox of personalization
The industry consensus is that most consumers want personalization. This survey, however, suggests there is a gap between rhetoric and reality. Only one in five consumers in the UAE see personalization – be it in terms of service, communication, promotions and offers – as a leading benefit of loyalty programs.
Most valuable benefits you receive from being a member of this program:
- Personalized communications: 6%
- Personalized customer service: 7%
- Personalized offers or promotions: 8%
What will promote loyalty?
Discounts may be a key driver to join. Only three percent of those not belonging to a loyalty program cited “personalization” as a benefit that would encourage them to join.
Of those consumers who do not belong to any rewards or loyalty programs, the most common reason is lack of awareness, followed by a lack of interest in benefits.
There are still opportunities in developing and growing loyalty programs to positively impact customer experience and drive loyalty. However, it is important for brands and retailers to refine their loyalty value proposition. Our research suggests that four factors should be considered when revamping a loyalty program:
Make loyalty programs easier to use
Sixty-one percent of local shoppers would like to have more flexibility to earn or utilize benefits. UAE brands need to pay more attention to their onboarding process and, concurrently, the earning and redemption process.
Clarify their purpose
Sixty-five percent of UAE consumers believe they belong to too many loyalty programs. Successful engagement must always be relevant and well timed. Harnessing the power of available data may inform improved interaction and help brands provide a program that stands out from the crowd.
Almost four in ten (39 percent) of UAE consumers who do not belong to loyalty programs say it is because they are not aware of any. In addition to making programs more accessible and clarifying what benefit the customer derives, companies must also promote their programs.
Freshen them up
Twenty-nine percent of local users find current loyalty programs unattractive. Sixty-one percent mentioned that the most valuable benefit of a reward program is “cashback on future purchase.” A review of the current value proposition, with a focus on local consumers’ needs, may provide an effective new approach to providing rewards and promoting loyalty.