Loyalty programs could be mobile financial service's missed opportunity
|Richard Harris in Marketing & Promotion Friday, February 17, 2017|
Mobile financial service (MFS) providers are failing to fully realize the potential of loyalty programs.
The survey, which was commissioned by Amdocs and conducted by analyst and consultancy firm Ovum, focused on banked and unbanked users of MFS worldwide. It surveyed 1,800 consumers and 42 service providers across 9 countries in emerging and mature markets including the United States, Singapore, Russia, Brazil, Indonesia, Mexico, the Philippines, Bangladesh, and Vietnam.
“MFS providers who employ loyalty programs to engage and retain customers are better placed to increase usage and adoption of their mobile wallet service, thereby driving revenue growth,” said Eden Zoller, principal analyst at Ovum. “However they must still address the gaps that exist between what customers want and what they are being offered.”
Key survey findings
- Ability to manage multiple loyalty cards using a single mobile wallet is the most important feature - but not well supported by service providers: The overwhelming majority of respondents consider it very important (61%) or important (34%) to be able to manage different loyalty cards via a single wallet. However, only 33% of service providers offer this feature. The other important feature that consumers want is the ability to share loyalty points with friends and family. While 46% rated this feature as very important and 42% as important, only 21% of service providers support this. Younger respondents (aged 16-24) showed even more interest, with 51% saying it was very important and 40% rating it as important.
- Tiered loyalty programs drive greater mobile wallet usage: Only half of service providers offer tiered loyalty programs. Of these, 79% said that the prospect of earning higher tier points incentivizes customers to use their services more. Consumers however, still lack awareness of such programs, with 19% saying they didn’t know if their loyalty program was tiered.
- Consumers like to accumulate loyalty points to purchase products and services or to receive cash discounts; cash backs on purchases or vouchers for free purchases: While overall, consumers are receiving the rewards that they like, gaps still exist. Although there is a marked preference for cash back (41%), this type of reward was not available to one-third of respondents. The same holds true for vouchers, where 30% wanted to receive such rewards but only 22% were offered them.
- MFS-linked loyalty programs represent a highly untapped market: 56% of respondents were not members of an MFS-linked loyalty program. One-third of these were not offered any such program. Of unbanked respondents, who stand to benefit most from MFS-linked loyalty programs, only 22% said they were registered to one.
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