Market Overview:

The Global Loyalty Management Market Size Was Valued At USD 7.84 Billion In 2022 And Is Expected To Expand At USD 17.42 Billion With CAGR Of 10.5% From 2022 To 2030.

A loyalty management system is a marketing automation technology used to build, manage, and evaluate the success of loyalty programs. The purpose of loyalty programs is to establish consumer involvement in order to understand and influence customers' purchasing decisions. The rising retail and e-commerce marketplaces, as well as the firm configuration shift to a customer-centric approach, are important factors impacting market growth. The loyalty management market consists of well-planned and effective efforts to choose, manage, relate, and govern client purchasing behavior. This technique keeps a customer by offering prizes for repeat purchases. These committed clients use an advocacy-driven mobile-delivered, cloud-based program to share their experiences with their own networks. This could enhance marketing and bring in new customers. 

COVID-19 Impact:

The COVID-19 pandemic has had a mild effect on the growth of the global loyalty management industry. The COVID-19 epidemic has had a significant impact on manufacturing, tourism and hospitality and transportation and logistics. The government, education, and retail sectors are all impacted slightly. Client traffic has negative result on the closure of banks and other financial institutions. The COVID-19 epidemic has severely interrupted the operations of the automobile sector, which has had an impact on the development of vertical solutions. In the face of the epidemic, businesses will need to reevaluate their strategy to client retention and acquisition. The majority of successful brands in our time take advantage of market inflection points to change effect radical change.

Market Dynamics:

Latest Trends: 

Consumer experience and loyalty are closely related. Artificial intelligence (AI) and machine learning, for example, have the potential to completely change loyalty management systems in the future. It may deliver advanced information to retailers in order to increase consumer dialogue, experience, and total sales. These technologies can forecast human behavior and buying trends using various analytics. It is then used to target relevant consumers in order to improve user experience, which is expected to fuel the growth of the loyalty management market.

Driving Factors:

To produces significant growth from their incentive systems, major players have put personalization in place. Customers will notice this functionality, which will improve their overall experience. Companies that want to benefit from their business must provide personalized advice, discounts, and promotions. Initiatives like these make customer happier, which encourages their implementation in other industries. By generating personalized recommendations and offers based on data obtained through many ways, brands can win over customers' attention and confidence. Individualized incentive programs are being used by many businesses due to their benefits.

• In April 2021 - Schuh, a U.K.-based trendy footwear store, partnered with Salesforce.com to develop its reward program. To attract consumers, the program based on the Salesforce Customer 360 Platform creates customer-centric and customized efforts.
• In October 2020 - Flooid Hub, a point-of-sale provider, worked with HTK Limited to deliver a tailored incentive system for digital and in-store retail.

Restraining Factors:

Government rules may make market growth more challenging. Questions regarding different federal and rules set by certificate laws, trade stamp laws, data security rules, and privacy laws, may limit the development of loyalty schemes. A variety of privacy and security conventions and legislation govern merchants' access to client information. Enterprise failure to make customer happy has an impact on platform adoption. Due to a variety of credit card-related rules and legislation, the banking sector is banned from altering its incentive structure, which has an impact on the market's overall expansion.

Opportunities:

A new generation of Customer Relationship Management (CRM) strategies was brought about by the development of big data concepts. Big data analysis enables businesses to recognize sales transactions, understand client behavior, and create effective marketing programs in order to foster long-lasting customer loyalty. First, the new strategy was used to separate clients. Time-Frequency Financial (TFM) where: Time (T) is the total length of calls and Internet sessions in a given time window. Frequency (F) is the amount of time spent using services in that time frame. Financial (M): For each section or group, the amount of money spent over a specific time period and the degree of loyalty were determined. Second, the categories created from the loyalty level descriptors were used to select the optimal behavioral characteristics for customers, including details about their age and gender. Thirdly, several classification algorithms were applied based on the descriptors and the selected attribute to build different predictive models that were used to classify new users by loyalty.

Challenges:

• Operation Management: Day-to-day operational management and resolving customer queries, issues and complaints plus establishing a good customer service function is a key challenge for successful operation management. It is wise to have all required operational processes and trained resources in place to mitigate operational risks.
• Meeting Loyalty Metrics and KIPs: Reaching to Loyalty Metrics is a key challenge considering the fact that most Loyalty Programs are not very profitable in first years of operation. Managing and optimizing OPEX to boost profitability, delivering a unique customer experience and reducing customer churn rate will always remain key challenges.
• Enhancing Competition: Increasing competition and attractiveness of the program in the market and attracting new customers and even competitors customers will be a marketing challenge especially if competitors have developed their Loyalty Program in the market.
• Increasing Customer Experience: Delivering a unique customer experience for different segments based on customer behaviour insight and analysis on usage, point collection, reward redemption, etc and designing personalized reward patterns for different segments will be a key challenge for a large client with a huge customer base.

Strategic Development:

• In June 2021- Oracle acquired CrowdTwist, one of the leading providers of cloud-native customer loyalty solutions designed to empower brands to personalize the customer experience.
• In May 2021 - Kobie received an exclusive license to the loyalty and co-branded credit card space for Rosemark's Quantitative PersonaTM (QP) approach. The QP methodology identifies the most valuable customers in each market based on preferences that drive economic value.
• In April 2021 - Comarch launched its new microsite, the Loyalty Marketing Cloud. The new website is designed to provide the ultimate user-friendly experience with improved navigation and functionality, while allowing customers to explore Comarch's products.

Segmentation Analysis:

Based on Component:

The loyalty management market is divided into software and services based on types.

Due to its ability to identify potential repeat and firm loyal clients, software will have the lion's share of the market share, driving up demand. Additionally, it helps in the delivery of personalized incentive based on past and present purchases from the customer.

When more profitable platforms and solutions are deployed, services will increase sharply. Among the services provided are client service, campaign management, IT & customer service, and technology service.

• Software
• Services

Based on Deployment:

The market is divided into on-premises and cloud deployment types.

Throughout the expected duration, the cloud sector will have the largest market share and experience substantial expansion. A wide range of user-friendly devices, including mobile phones, social media, tablets, and many more, are available through the cloud deployment method. The cost-effective cloud-based software also tracks real-time updates on client questions and response times. For instance, Comarch SA unveiled its Loyalty Cloud 1.2 in March 2021 to lower the cost of management, operations, and creating immersive programs for users. On-premises will exhibit constant development thanks to the robust security protocol.

• On-Premise 
• Cloud

Based on Organization Size:

The loyalty management market is split into small and medium-sized businesses and large businesses based on the size of the organization.

Due to the expenditures made in loyalty solutions due to their many clients and rising purchase frequency, large companies will hold the lion's share of the sector market share. Their market position is strengthened and their potential brand exposure is increased.

Due to the increasing affordability of cloud-based solutions, small and medium-sized businesses will experience the rate of expansion over the expected term. For example, Epsilon Data Management, LLC announced People Cloud Loyalty, a solution for mid-sized businesses, in September 2020 to increase customer engagement and connections.

• Small and Mid-size
• Large

By Industry Vertical:

The loyalty management market is divided into BFSI, IT & Telecommunication, retail, manufacturing, transportation, hotel, media & entertainment, and others depending on the industry vertical it serves.

Due to the industry's intensive conflict, which is promoting the creation of customer-rewarding solutions, the retail segment will gain a substantial market share. The loyalty program also helps to enhance sales and revenue growth because of higher buy frequency and the fact that the retail industry is more transactional.

BFSI will grow quickly over the expected time period. BFSI's commendable software includes JustBilling, Punchcard, EchoApp, SailPlay, among others. Banks employ these solutions to increase and maintain their customer base as a result of increased competition in the banking sector. Moreover, platforms for online and mobile banking are creating new opportunities for gaining the interest and loyalty of customers.

The hospitality industry is also heavily adopting the rewarding strategy to improve customer retention by offering rewards based on, among other things, customers' preferences, hobbies, and spending patterns. In a similar vein, the media, entertainment, and transportation sectors are moving toward rewarding software to boost customer confidence in their brands.

• Banking, Financial Services and Insurance (BFSI)
• Retail
• Travel and Hospitality
• Manufacturing 
• IT and Telecom
• Media and Entertainment
• Healthcare
• Others

Regional Insights:

In 2021, North America's share of global revenue will be close to 32%. Developed nations like the United States and Canada are found in North America. Customers in the area prefer retail companies that have a high level of brand loyalty. Most consumers like monetary benefits like cash back, rebates, and product discounts. All of these many variables imply market.

Real-time reporting, large investments in AI-based loyalty programs, and solutions built on customer data analytics are all driving the adoption of loyalty management solutions. Several companies favor giving customized loyalty programs to a range of customers with the potential to spur growth.

Over the forecast period, Asia Pacific is expected to experience the highest CAGR of 11.6%. India and China are two examples of the Asia-Pacific region's rising economy. The market is looking to expand as a result of rising social media usage, rising internet penetration, and rising e-commerce industry popularity. For the growth of the regional market, credit and debit card usage is encouraged on e-commerce sites in China and India.

The worldwide loyalty management market has been studied geographically in a number of areas, including North America, Europe, Asia-Pacific, Latin America, the Middle East, and India. This market will soon be dominated by the global region.

• North America
• US
• Canada
• Mexico
• Rest of North America
• Europe
• Germany
• France
• Italy
• Spain
• UK
• Nordic Countries
• Denmark
• Finland
• Iceland
• Sweden
• Norway
• Benelux Union
• Belgium
• The Netherlands
• Luxembourg
• Rest of Europe
• Asia-Pacific
• Japan
• China
• India
• Australia
• South Korea
• Southeast Asia
• Indonesia
• Thailand
• Malaysia
• Singapore
• Rest of Southeast Asia
• Rest of Asia-Pacific
• The Middle East & Africa
• Saudi Arabia
• UAE
• Egypt
• South Africa
• Rest of the Middle East & Africa
• Latin America
• Brazil
• Argentina
• Rest of Latin America

Key Vendors:

To learn more about the businesses, profiles of several prominent people have been created. It provides in-depth explanations of a considerable number industries operating in international locations. It provides useful information about key players:

• Epsilon (US)

Epsilon is a multinational advertising and marketing technology firm at the heart of Publicis Groupe connecting marketers and consumers to drive success while respecting and preserving consumer and client privacy and data. Epsilon enhances clients' capacity to leverage the value of their first-party data in order to confidently enhance, activate, and measure campaigns. We believe in an advertising economy that is open and prioritizes privacy.

• Oracle (US)

The cloud technology company that provides organizations across the globe with computing infrastructure and software to help them innovate, uncover efficiencies, and become more efficient. They developed the world's first and only autonomous database to help organize and secure our clients' data. Oracle Cloud Infrastructure offers enhanced efficacy, security, and savings. It is intended to facilitate the migration of workloads from on-premises systems to the cloud, as well as between the cloud, on-premises systems, and other clouds.

• Bond Brand Loyalty (Canada)

Bond drives client growth by fostering long-term partnerships between individuals and companies through intelligent connections and engaging experiences. Bond serves clients globally with customer experience and loyalty solutions, guided by insights from advanced research and practical commercial application through the Bond Behavioural Institute and enabled by technology through its proprietary cloud Synapze platform, allowing brands, customers, employees, partners, and the communities they serve to reap the benefits of growth.

• Kobie (Russia)

Kobie provides market-leading, end-to-end loyalty solutions that facilitate customer experiences for the most successful brands in the world.

• Brierley+Partners (US)

Brierley is redefining loyalty around the world by translating client difficulties into successful and lucrative loyalty solutions. Brierley brings combines cutting-edge technology, leading industry expertise, consumer data analytics, and thought leadership to assist businesses in increasing brand loyalty. Brierley provides a broad range of services to help clients achieve extraordinary loyalty success, including program design, strategy, research, analytics, customer insights, creative, and digital solutions.

• Merkle (US)

Merkle is a leading data-driven customer experience management (CXM) company that specializes in the delivery of unique, personalized customer experiences across platforms and devices. The company's history in data, technology, and analytics serves as the foundation for its unrevealed comprehension of consumer insights, which drives its hyper-personalized marketing strategies.

• Capillary (Singapore)

Capillary Technologies, founded in 2012, provides end-to-end loyalty programs, a comprehensive perspective of consumers, and unified, cross-channel tactics that provide customers with a real-time omnichannel, personalized, and consistent experience. Capillary drives a diverse product suite of end-to-end loyalty programs throughout 30+ countries, working with 250+ brands, and has a presence in the United States, India, the Middle East, and South East Asia.

• Comarch (Poland)

Comarch is the foremost global IT company and employs more than 7,000 IT engineers, business consultants, and marketing professionals. Thousands of complex and successful IT initiatives and the implementation of our software in over 40,000 businesses around the world are a source of great pride. Comarch is a global provider of IT business solutions that optimizes business and operational processes.

• ICF Next (US)

ICF Next are creatives, communicators, strategists, and technologists with a mission working as part of the worldwide consulting ICF to better the world in fields ranging from energy to health to transportation and beyond.

• ProKarma (US)

PK is now Concentrix Catalyst, the experience design and engineering team of Concentrix. Our clients rely on the company to bring integrity, innovation, and an unyielding commitment to ensuring their success when delivering simple, effective solutions to complex business problems. With proven processes and technology expertise that set the stage for successful execution and delivery, we know how to deliver the right solutions at the right time, allowing our clients to benefit from productive workflows with quantifiable outcomes.

• Jakala (Italy)

JAKALA, the top Italian Mar-Tech company in Europe, assists its clients in realizing their full commercial potential by leveraging data, advanced analytics and artificial intelligence, technology, content, and experience design. JAKALA was the first company in Italy to merge marketing and technology when it was founded in 2000. JAKALA also assists companies in transforming successful loyalty programs into more innovative and technology ecosystems in order to retain high-value consumers and provide a more personalized experience.

• Annex Cloud (US)

Annex Cloud has been the worldwide leader in technology and service solutions that transform customer loyalty experiences for organizations, extending valued customer engagements, ultimately making beloved brands. Annex Cloud customers capture and use zero and first party data to seamlessly deliver hyper-personalized experiences across the entire customer journey – from awareness to purchase to retention, loyalty and advocacy.

• Apex Loyalty (US)

APEX digitalizes retail channels by adopting loyalty and digital ordering platforms that facilitate consumer engagement, personalized communication, and incremental sales.

Scope of Report:

Conclusion:

• In-depth analysis of the global loyalty management market and dynamics is provided to understand the market scenario.
• Quantitative analysis of the current trends and future estimations from 2017 to 2023 is provided to assist strategists and stakeholders to capitalize on prevailing opportunities.
• Porters Five Forces analysis examines the competitive structure of the market and provides a clear understanding of the factors that influence the market entry and expansion.
• A detailed loyalty management market analysis of the geographical segments enables identification of profitable segments for market players in the global loyalty management industry.
• Comprehensive analyses of the trends, sub-segments, and key revenue pockets are provided.
• Detailed analyses of the key players operating in the global loyalty management industry and their business strategies are anticipated to assist stakeholders to take informed business decisions.