Three trends driving the evolution of customer loyalty

Customer loyalty programs are evolving to meet new technological advancements and heightened customer expectations, with 77% of such programs failing within the first two years. Despite this, loyalty remains important, with 73% of millennials viewing these programs as beneficial. The focus is shifting from traditional 'earn and burn' techniques to holistic customer experiences that consider the entire customer journey across multiple touchpoints, both online and offline. Businesses are moving toward personalized and impactful rewards, leveraging new technologies like AI and machine learning to gain insights into customer behavior. The rise of payment-led loyalty programs, which integrate directly with payment systems, is reducing friction at the point of sale while offering valuable data insights. Additionally, secure access to data is crucial, as new regulations emphasize user ownership, prompting businesses to provide consumers with more control over their data. Open Banking and APIs are contributing to this shift by facilitating innovative, data-driven loyalty solutions.