Is the Loyalty Program Successful in India? Let’s Decode

With the launch of new technologies and artificial intelligence, India has been rapidly growing in terms of brand loyalty and consumerism. You can say that the Indian market is highly diverse, complex, competitive, and dynamic based on its economic, social, and cultural factors that can easily help to shape consumer behavior. Plus, to get user attention and engagement with the product, brands majorly launch loyalty programs by introducing some perks to involve customers and encourage them to make more sales.

Through this blog, we are going to explore the landscape of reward programs and understand are these loyalty programs successful in India in building a loyal customer base.

Loyalty Programs in Indian Landscape

In recent years, Loyalty Programs also known as Reward Programs have effectively become an integral part of every industry. Be it sports, eCommerce, retail, medical, and others, they use loyalty programs to create a positive impact on customer’s minds by holding retention and customer loyalty. As per the latest report stated by Nielsen, more than 50% of Indians belong to several reward programs by big brands like Amazon and Nike, which makes India, the most loyalty-conscious country on the global stage. Meanwhile, the effectiveness of these schemes and rewards has also been debated due to their performance and stability.

In recent years, a major number of loyalty schemes in the country have failed to perform well on the grounds that they won’t be able to engage with their target audience, due to their poor execution of ideas and lack of innovation. Nowadays, customers want more from the brands as they have become precautiously aware and demanding, hence just a point and reward system won’t work in companies favor.

Scope of Reward Program in India ?

Considering the scope of these schemes within the country, then it’s high. India holds a power of multiple brands starting right from low to high across all sectors. Because, there are five types of major loyalty schemes are running in the country, and these are –

• Attitudinal Loyalty would be the first one on our list, as this type of Loyalty program is designed to understand a customer’s emotional attachment to a brand. Under the attitudinal loyalty scheme, brands try to sell their products by adding some nostalgic elements to the brand or product.
• Behavioral Loyalty is another type of point scheme that is based on your user’s purchase behavior. You can take the example of edible items under this, as people love to buy coffee or anything from their favorite brand, hence they love to repeatedly purchase.
• Those who love luxury and are willing to pay a premium price for a brand come under the Transactional Loyalty scheme. There are multiple branded perfumes that cost you more than 10K, but the target audience is willing to pay a premium price based on the products and services they get on behalf of the brand.
• Advocacy Loyalty basically works as a word of mouth strategy, as customers are willing to recommend their favorite brand or product to others based on their experience with the service. Other than this, companies offer them some referring amount on their account that they can use in their next purchase. Nowadays, Advocacy loyalty programs are trending as they offer the best reward structure and customer engagement with the brand for fruitful results.
• For those who are ready to switch to another brand come under Switching Loyalty. Well, these types of schemes are not good for your business but can help you to join hands with your competitor for effective services and well-defined prices. Thus, in this way, you won’t lose your potential customers.

Considering the major stats, in India, people love to buy products that are emotionally attached to them, hence the recommendation of these brands and products is also high. Other than this, Indian consumers are more influenced by word-of-mouth and online reviews, hence advocacy loyalty has a lot of potential in the Indian landscape.

How Do I Create an Effective Loyalty Scheme in India?

For creating a loyal customer base, the ultimate goal you should focus on first is to win your audience’s trust by offering them unique and valuable services which are much needed. You should focus on your customer’s preferences and needs, thus allowing them to experience personalized experiences with effective services.

Below is a complete blueprint on how to make an effective loyalty program in a country like India.

• Brands are required to go through their customer’s needs and must invest to build relationships with the buyers because Indian customers are more value-conscious and expect more than just a product.
• Similarly, building trust through maintaining transparency is also an important factor you should consider. Hence try to be apparent with your business practices, pricing, and products to develop a base of loyal customers.
• Customer experience is another important factor one should consider, therefore offering value-added services, such as warranty, free shipping, and returns can also create a positive image of the brand in the user’s head.
• Nowadays, people love to purchase products from brands that support socially responsible causes. You can take the example of Patanjali and Mamaearth, as these brands support natural products and offer a percentage of your sales to a special cause.
• Personalized experience with unique ideas also grabs more eyeballs to the brand or product. Take the example of a brand like Starbucks, as the company is known to offer a unique and personalized coffee experience by customizing beverages with the name printed on their coffee mugs while offering a comfortable and soothing atmosphere all under one roof.

To Conclude The Topic

Loyalty Marketing is a complex, competitive, and highly profitable way to make your brand stand out from the competitive crowd. Plus in India, brands are majorly focusing on offering digital experience, personalization, exclusive rewards, along with social responsibility. Thus, developing trust and providing value is the ultimate goal of each brand in the Indian landscape. With the expert vision of ITEconic, we help companies by developing unique loyalty programs based on your user’s needs and preferences.