PYMNTS MonitorEdge May 2024

Brands Use Mobile Data to Deepen Loyalty Connections With Customers

Brands Use Mobile Data to Deepen Loyalty With Customers

Loyalty programs have long served as a cornerstone for businesses seeking to cultivate lasting relationships with their customers.

With the ongoing evolution of mobile technology and advancements in payment innovations, these programs are poised to become even more effective in driving customer retention while enhancing lifetime value.

As Len Covello, chief technology officer at Engage People, told PYMNTS in an interview posted in December, the integration of payments into smartphones has contributed to the enhancement of loyalty programs, enabling customers to seamlessly make payments with loyalty points or receive tailored offers with a click on their phones.

This level of convenience and personalization creates an ideal environment for loyalty transactions, Covello noted, adding: “We’ve got all the tools available today.”

The convergence of mobile technology and loyalty programs is evident in initiatives by various companies, each catering to distinct consumer demographics and preferences.

Marriott International, for instance, partnered last month with BetMGM, a leading sports betting and iGaming operator, to expand its loyalty program beyond traditional hotel stays. Through the partnership, gamers can link their Marriott Bonvoy and BetMGM accounts, earning BetMGM Rewards points on the BetMGM sports betting app, which can then be redeemed for hotel accommodations across Marriott’s portfolio.

Marriot Executive Vice President and Chief Customer Officer Peggy Roe termed this a “landmark collaboration,” highlighting its ability to tap into the burgeoning online gambling market while providing added incentives to customers, thereby deepening their engagement with the brand.

Fetch, a mobile rewards platform, is also capitalizing on the surging popularity of gaming with the release last month of Fetch Play, an integration rewarding users for mobile gaming.

The feature, developed in partnership with adjoe, a mobile games connection platform, allows Fetch’s 11 million weekly users to accumulate Fetch Points by reaching milestones and completing in-game challenges, thereby not only enriching their loyalty and overall user experience but also fostering deeper engagement with the Fetch brand.

TikTok, meanwhile, introduced an in-app Creator Rewards Program, designed to compensate creators for producing engaging original content. By monetizing user-generated content, TikTok is not only seeking to bolster customer satisfaction but also foster an ecosystem that encourages creativity and innovation.

“With a community as unique and diverse as ours, we remain committed to investing in the best tools and technology for our creators to unleash their creativity, build their community and monetize in a way that’s most authentic to them,” the social media giant said in a March news release.

Using Data to Deliver Value to Customers

The proliferation of mobile loyalty programs underscores the role of digital platforms in fostering customer engagement and retention, with brands using mobile technology to personalize offerings, optimize user experiences, and forge deeper connections with customers.

The trend aligns with the adoption of digital wallets and contactless payments by brands to enhance loyalty program delivery, which according to Covello, gives brands access to extensive data on customer preferences and behaviors, enabling targeted ads and offers.

Starbucks serves as a prime example of successful implementation, he explained, seamlessly integrating its loyalty program with payment terminals to offer a rewarding experience for customers. Following Starbucks’ lead, other retailers and brands are harnessing smartphone data to understand customer behaviors and offer tailored, personalized incentives.

“That device knows a lot about you, and really when we talk about loyalty, that interaction with the loyalty program is about gathering data on the user and gathering behaviors,” Covello told PYMNTS.

While privacy concerns persist, loyalty programs have traditionally operated on the premise of exchanging data for personalized benefits. Therefore, when executed effectively, this data-driven approach can deliver value to consumers, he added.