CATEGORY

Loyalty Programs

Loyalty programs are structured marketing strategies designed by merchants to encourage customers to continue to shop at or use the services of businesses associated with each program. These programs exist covering most types of commerce, each one having varying features and rewards-schemes.

Beroe LiVE.Ai™

AI-powered self-service platform for all your sourcing decision needs across 1,600+ categories llike Loyalty Programs.

Market Data, Sourcing & Supplier Intelligence, and Price & Cost Benchmarking.

Schedule a Demo

Loyalty Programs Market Monitoring Dashboard


Supply Demand

Understand the correlation between costs, margins, and prices impacting your category on a real time basis on Beroe LiVE.Ai™

Loyalty Programs Industry Benchmarks


Savings Achieved

(in %)

The average annual savings achieved in Loyalty Programs category is 7.40%

Payment Terms

(in days)

The industry average payment terms in Loyalty Programs category for the current quarter is 58.6 days

Compare your category performance against peers and industry benchmarks across 20+ parameters on Beroe LiVE.Ai™

Category Strategy and Flexibility

Engagement Model

Supply Assurance

Sourcing Process

Supplier Type

Pricing Model

Contract Length

SLAs/KPIs

Lead Time

Supplier Diversity

Targeted Savings

Risk Mitigation

Financial Risk

Sanctions

AMEs

Geopolitical Risk

Cost Optimization

Price per Unit Competitiveness

Specification Leanness

Minimum Order Quality

Payment Terms

Inventory Control

Meet Abi

The World’s first Digital Market Analyst

    Schedule a Demo
    Meet Abi

    The World’s first Digital Market Analyst

    Abi, the AI-powered digital assistant brings together data, insights, and intelligence for faster answers to sourcing questions

    Loyalty Programs Suppliers


    10,114
    Total Suppliers
    286
    Diverse Suppliers
    74
    Normalized Supplier Rating
    Loyalty Programs Supplier

    Find the right-fit loyalty programs supplier for your specific business needs and filter by location, industry, category, revenue, certifications, and more on Beroe LiVE.Ai™.

    Sample Supplier
    Company
    Omnicom Group Inc.
    Location
    Jackson, Mississipi
    Duns number
    3862211

    D&B SER Rating

    dnb logo

    Up to 3 months

    1 9
    6
    Low Risk High Risk

    The Supplier Evaluation Risk (SER) Rating is Dun & Bradstreet’s proprietary scoring system used to assess the probability that a business will seek relief from creditors or cease operations within the next 12 months. SER ratings range from 1 to 9, with 9 indicating the highest risk of failure. We’ve prepared an infographic to help business owners better understand what influences their SER Rating.

    Moody`s ESG Solution
    ESG Profile

    Company and Sector Performance
    39

    100
    Limited (1)
    ESG Perfomance (/100)
    Environment
    62
    Social
    30
    Governance
    47
    6 Domains Performance (/100)
    Business behaviour
    41
    Human rights
    51
    Community Environment
    18
    Corporate governance
    49
    Human resources
    17
    Security Scorecard
    81

    Threat indicators
    B
    83
    Network Security
    Detecting insecure network settings
    A
    100
    Hacker Chatter
    Monitoring hacker sites for chatter about your company
    A
    100
    DNS Health
    Detecting DNS insecure configuration and vulnerabilities
    F
    56
    Application Security
    Detecting common website application vulnerbilities
    B
    84
    Endpoint Security
    Detecting unprotected enpoints or entry points of user tools, such as desktops, laptops mobile devices, and virtual desktops
    A
    100
    Cubic Score
    Proprietary algorithms checking for implementation of common security best practices
    A
    92
    Patching Cadence
    Out of date company assets which may contain vulnerabilities of risk
    A
    100
    Social Engineering
    Measuring company awareness to a social engineering or phising attack
    B
    89
    IP Reputation
    Detecting suspecious activity, such as malware or spam, within your company network
    A
    100
    Information Leak
    Potentially confidential company information which may have been inadvertently leaked

    Industry Comparison
    omnicomgroup.com
    Industry average
    Adverse Media Appearances
    Environmental Issues
    0
    Workforce Health Safety Issues
    0
    Product Service Issues
    2
    Human Rights Issues
    0
    Production Supply Chain Issues
    2
    Environmental Non Compliance Flags
    4
    Corruption Issues
    0
    Regulatory Non Compliance Flags
    6
    Fraud Issues
    1
    Labor Health Safety Flags
    6
    Regulatory Issues
    5
    Workforce Disputes
    0
    Sanctions
    0
    esg energy transition
    72
    Discrimination Workforce Rights Issues
    6
    esg controversies critical severity
    No

    Loyalty Programs Market Intelligence

    global market outlook

      • The global loyalty program market is valued at $180 billion in 2022 (E). The market is forecasted to grow at a CAGR of 5–6 percent to $179–191 billion between 2022 and 2026(F) . 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.
      • Price, input cost and demand movements are in a neutral/almost favorable condition to procurement, while the competition is stable.
      • Loyalty program penetration is high outside Europe and North America, due to increasing e-commerce and online buying behavior of the customers.
      • High adoption for Loyalty Program in APAC, due to the presence of regional/global suppliers with established technology platform and regional/local merchant network offering iconic reward catalog. Global buyers are looking at consolidating the supply base.The Middle East and Africa have low adoption, as infrastructure and connectivity pose a challenge in rewards sourcing, fulfillment, and delivery in certain locations.

    Loyalty Programs market frequently asked questions


    The global loyalty management market is expected to reach a market size of $215-$216 billion by 2022.

    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.

    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.

    Beroe's loyalty program analysis shows that the global loyalty management market is expected to grow at 4-5% by 2022.

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

    Loyalty Programs market report transcript


    • 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 program 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 are high and the supplier passes on a part of the margin as a discount to clients.

    Adoption of Advanced Technologies

    • The success of a business is measured by the success of its consumers. Leading-edge technologies such as artificial intelligence (AI) and machine learning (ML) predict human behavior and buying patterns through various analytics.

    • Moreover, AI and ML hold the potential to shape the strategies of loyalty program service providers. The AI-based predictive analysis helps businesses target relevant consumers to improve their customer experience (CX). 
    • AI and ML track several transactions as well as monitor and prevent hackers or crackers who might break into loyalty account points.
    • Furthermore, both these innovative technologies provide retailers intelligent insights that can help improve consumer conversation, experience - and total sales.

    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 providers will save cost by reducing the cost per unit of reward fulfillment (supplier provides discounts as the number of merchandising units increases due to economies of scale).

    Rising Trend of Personalization

    • To extract substantial revenue from loyalty programs, leading market players are integrating personalization into their loyalty platforms. 
    • Customers are getting attracted to custom coupons, recommendations, and promotions.
    • Such loyalty programs improve customer satisfaction thus auguring well for loyalty program providers.
    • By leveraging data gathered from omnichannel loyalty platforms, companies can make custom offers and recommendations to grab consumers' attention and trust.

    Constraints

    Subcontracting Practices

    • Subcontracting of reward sourcing and delivery is done in case of suppliers lacking a 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 spending 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.

    COVID-19 Impact on Loyalty Program Market

    The COVID-19 crisis is positively impacting the loyalty market as a majority of customers are rapidly shifting toward digital channels to buy products or services amidst the nationwide lockdown and related restrictions. The unprecedented growth of the e-commerce industry during the public-health crisis has influenced retailers to attract and retain maximum consumers to their websites, setting high hopes for loyalty platform providers.

    Why Should You Buy this Report?

    This report on the loyalty market also provides a descriptive industry overview 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 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.