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Loyalty Programs
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Intelligence covers market and price outlook, SWOT analysis, demand & supply drivers, engagement models and Procurement best practices

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Get up-to-date market and supplier info on Loyalty Programs to help you build

Intelligence covers market and price outlook, SWOT analysis, demand & supply drivers, engagement models and Procurement best practices

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Intelligence on category covers the following aspects market outlook, supply market, SWOT analysis, Cost components & Price outlook, Demand and supply drivers, Engagement Models and Procurement Best Practices

manage-risk

Assess Supplier Risk based on key risk and compliance parameters

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Supplier assessment covers the following parameters Financial Risk, Ethical, Labor, Environmental Compliance, IT Security.

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Supplier assessment is powered by world’s leading data partners including D&B, CreditSafe, Dow Jones, Refinitiv, Orpheus

discover-supplier

Identify right fit suppliers based on your selection criteria including revenue, capabilities, certification, geography

1

Select suppliers based on industry, country, classification from a database of 4.2 mn suppliers. Get detailed supplier profiles with supplier capabilities, revenue, certifications, risk ratings

assess-category-perforamnce

Benchmark your category performance against peers and the market

1

Measure category performance on 15 key parameters across cost, risk and strategy KPIs

source-market-indices

Get information on key factors affecting your supply

1

Source Macro Data and Market Indices information from leading data sources across these key areas - Labor Rates, Currency, Energy, Country Risk, Trade Flow/Transportation, Port Data, Tariff, Weather and Epidemics

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Report Coverage

The report provides insights on the following:

  • Global Capacity–Demand Analysis
  • Global Trade Dynamics
  • Regional Market Snapshot-North America, Europe, Asia
  • Cost Structure Analysis
  • Information relating to market, supply, cost, and pricing analysis
  • Hard to find data on cost and TCO models, supplier details, and performance benchmarks
  • Macroeconomic and regional trends impacting cost, supply, and other market dynamics
  • Category-specific negotiation and sourcing advice

Market Size

CAGR

3-4 Percent

Market Size North America

$71 - 73 Bn

Market Size Europe

$36 - 38 Bn

Market Size Asia Pacific

$21 - 23 Bn

The market for global loyalty programs is expected to reach $215-$216 billion while growing at a CAGR of 5-6 percent between 2017 and 2022. By 2020, the global loyalty management market was expected to reach anywhere between $184 and $186 billion according to Beroe’s loyalty management market report. 

In the loyalty management market, high market maturity would be experienced in regions such as Western Europe, North America, and some parts of APAC such as Australia, Japan, Hong Kong, and Singapore. In addition to this, APAC and parts of the LATAM are also expected to be the future growth driving markets for loyalty program services. The participant rewards can constitute up to 75% of the total costs.

Loyalty Program - Global Industry Analysis

  • The global Loyalty Program market was valued at $172.5 billion in 2018.
  • The Loyalty Program market in North America was valued at $72 billion in 2018 and is growing at a CAGR of 2-4 percent.
  • Regions such as Western Europe, North America, and some parts of APAC, such as Australia, Japan, Hong Kong, Singapore, have high market maturity.
  • Poland, Morocco,  Canada, central US regions, Brazil, Mexico, and India are among the various medium market maturity regions.
  • The APAC and parts of Latin America are expected to be the future growth driving markets for loyalty program services as the loyalty management market size will increase tremendously.
  • The top global service providers include Connexions Loyalty, Aimia, Blackhawk Network, and Maritz Motivation.
  • The cost-saving strategies such as service bundling and payment term optimization among others can be utilized to cut costs.

Loyalty Programs Market Overview

Loyalty Program - Global Industry Trends

  •  The growing geographic footprint of service providers and the adoption of global loyalty program strategy by buyers indicate the increasing maturity and willingness of both the supplier and buyers to partner on a global scale
  •  Suppliers are also improving their supply capability while adopting performance-based metrics for evaluation and monitoring of both channel and customer loyalty program
  • E-commerce is fueling the demand for B2C loyalty, whereas B2B is driven by customer retention, as the marketers aim to guard their brand against generic products in the market. This has led to the outsourcing of services by buyers to ensure customer loyalty while driving down costs.
  • In order to boost loyalty program participation in the Middle East, suppliers are investing in analytics and business intelligence tools to personalize the program for relevant rewards and incentive schemes. This can be a game-changer in the region whereby customers have been wary of such programs. It can help bring this region into the spotlight as more customers will be willing to participate thereby fuelling the growth of the market.
  • Globally, suppliers are increasingly focusing on customer acquisition and retention operations. Customer retention ensures that existing customers can be retained and new customers can be acquired and turned into loyal customers. This has allowed suppliers to offer a range of loyalty programs that are suited for different needs.
  • Rather than take a single approach, suppliers are focusing on providing a range of loyalty programs depending on their customers. These include loyalty card schemes such as card rewards, affinity programs, cashback programs, and point-based card rewards.
  • The pricing component is based on the specific project. Sometimes, the pricing is based on the volume too, and can vary from industry to industry and the particular requirements.

Why should you Buy this Report?

The report also provides a descriptive overview of the market for loyalty programs in areas such as North America, Europe, Middle East, Africa, APAC, Australia, and Latin America. It also explores the various opportunities and challenges affecting the loyalty programs industry, along with Porter's five forces analysis of developed and emerging markets. 

Methodology for writing this Report

Beroe gathers intelligence through primary sources that include industry experts, researchers, and consultants, as well as current suppliers, producers and distributors. Secondary sources can include business journals, newsletters, magazines, market research data, company sources, and industry associations. Following data collation, analysis, and strategic review, the Final Research Report is published on Beroe LiVE.

Table of contents

  1. Loyalty Programs Executive Summary
  2. Global Loyalty Program Industry Outlook
  3. Impact of COVID-19
  1. Loyalty Programs Market Analysis
  2. Global Loyalty Program Market Maturity
  3. Global Loyalty Program Industry Trends
  4. Growth Drivers and Constraints
  5. Regional Market Outlook
  6. Industry Outlook
  7. Porter's Five Forces Analysis - Developed Markets
  8. Porter's Five Forces Analysis - Emerging Markets
  9. Market Outlook - Retail

 

  1. Loyalty Programs Procurement Best Practices
  2. Sourcing Models for Loyalty Program Services
  3. Sourcing Models - Comparative Analysis
  4. Sourcing Models - Pros and Cons
  5. Sourcing Model Adoption
  6. Pricing Models - Comparative Analysis
  7. Sourcing Strategies - BFSI
  8. Key Services - based KPI and SLA Components
  9. Loyalty Programs Cost Structure Analysis

 

  1. Airmiles Market Overview
  2. Airmiles Market Share in the US
  3. Total Miles Market Global vs. US
  4. Noted Trends in Airmiles
  1. Purchasing Process
  2. FRP/ RFI Inputs

 

  1. COVID Impact
  2. Sourcing Location Watch
  3. Supplier Watch
  4. Industry Watch

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  • The global Loyalty Program market was valued at $181 billion in 2019.
  • The market is forecasted to grow at a CAGR of 3–4 percent to $185–195 billion between 2020 and 2022.
  • Regions, such as Western Europe, North America, and some parts of APAC, such as Australia, Japan, Hong Kong, Singapore, have high market maturity.
  • The APAC and parts of Latin America are expected to be the future growth driving markets for loyalty program services.

Growth Drivers and Constraints

The growth of retail and e-commerce in the emerging markets is expected to drive loyalty program budgets in these markets. Growth in online buying culture, high adoption of mobile and smartphone by the consumers had raised the need for a digital loyalty program strategy. This will be a major growth driver in mature markets. Adoption of schemes such as a loyalty scheme under which you get customer loyalty and channel loyalty programs, membership programs, frequent flyer programmes, and digital rewards can help drive the market further.

Drivers

Cost Benefits

  •  Outsourcing in the reward programme market has led to a reduction in the number of hours billed for the technology platform. The initial infrastructure cost for creating a technology platform is a one-time spend and this platform is customized to suit client requirements. Hence, the margins on a long term contract in providing this platform to clients is high and the supplier passes on a part of the margin as a discount to clients

Potential Industry Sectors

  • The demand for loyalty services is primarily driven by the retail, financial services, consumer product and food and beverage industries. Demand for digital reward program, analytics and business intelligence for customization by the retail and marketing services, food and beverage industries is a key driver. This can help propel the customer engagement program and reward plan schemes that can be a major driver.

Operational Benefits

  • Outsourcing allows buyers to standardize the level of services across various locations. Productivity and efficiency could be enhanced through the introduction of various critical performance indicators and compliance clauses in the contract
  • Centralized procurement through global/regional service provider will save cost by reduction of the cost per unit of reward fulfilment (supplier provides discounts as the number of merchandising units increases owing to economies of scale)

Constraints

Subcontracting Practices

  • Subcontracting of reward sourcing and delivery is done in case of suppliers lack proper network in a particular region or when the program requires high localization. This practice indirectly affects the buyer since subcontractors (Local Agency) charge a margin to the service provider, which is eventually passed on to the buyer. This margin–on–margin increases the spend of the buyer

Limitation of Technology Platform

  • The loyalty program that runs on the plug and play SaaS model and is limited by SaaS capability will face issues as the customization of the program may spike the cost of the program and cost saving by avoiding customization may lead to a dissatisfied customer

Government Regulations

  • Regulations specified by the government can hinder the market in some ways. For example, Ontario’s Protecting Rewards Points Act changed the process of reward programs in Ontario. A thorough look into the regulations and how it affects the business processes is crucial to understand its impact.

Loyalty Programs Market Frequently Asked Questions

  1. What is the market size of the loyalty programs market?
  2. The global loyalty management market is expected to reach a market size of $215-$216 billion by 2022. 

 

  1. Who are the major players in the loyalty programs industry?
  2. As per Beroe’s loyalty program report, the high market maturity regions in the loyalty management market are West, East, and Gulf coast of US, UK, France, and Germany, Singapore, Hong Kong, China, Japan, and Australia, South Africa, UAE, Egypt, and Nigeria. The medium maturity markets are Canada and the central regions of the US, Spain, Portugal, Spain, Portugal, Poland, Morocco, Korea, Vietnam, India, Brazil, Argentina, Chile, and Mexico. 

 

  1. What are the latest trends in the loyalty programs market?
  2. The various loyalty program trends are that there is an increasing cooperation between buyers and sellers in the loyalty management market which is leading to growing maturity. Suppliers are also ramping up their supply capability and monitoring their performances. E-commerce is also leading to rising demand for B2C loyalty. 

 

  1. What will be the expected growth of the loyalty programs industry?
  2. Beroe’s loyalty program analysis shows that the global loyalty management market is expected to grow at 4-5% by 2022. 

 

  1. What are the key drivers of the loyalty programs market?
  2. Some of the key drivers for the loyalty programs market are cost benefits, demand from potential industries, and operational benefits. 

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