LONDON--(EON: Enhanced Online News)--According to the latest procurement intelligence report from Technavio, the global loyalty programs market is expected to grow at a CAGR of 13.5% over the next five years due to the increase in disposable income accompanied by suitable benefits such as product discounts.
“The development of innovative loyalty programs such as coalition program and provision of relevant benefits drive the growth of the global loyalty programs market”
The research report titled ‘Global Loyalty Programs Market: Procurement Market Intelligence Report 2017-2021’ provides an in-depth analysis of category spend, best procurement practices and cost saving opportunities, aimed at helping organizations achieve superior business performance. The report also provides insights on pricing, supplier positioning and top companies, enabling sourcing professionals to improve their competitive advantage through procurement excellence.
“The development of innovative loyalty programs such as coalition program and provision of relevant benefits drive the growth of the global loyalty programs market,” says lead Technavio procurement specialist Angad Singh for category spend intelligence. “The use of omnichannel loyalty has increased the reach of program benefit details to a wider audience, subsequently attracting customers toward program membership,” adds Angad.
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Cost saving opportunities in the global loyalty programs market
The adoption of various cost-optimization levers helps buyers in the global loyalty programs market realize direct cost savings and enhance category management and value benefits (including reduced procurement complexities).
Technavio procurement experts have segmented the cost saving opportunities in the global loyalty programs market into the following value-enhancement opportunities:
- Adoption of technology
- Supplier Competition
- Adoption of negotiation strategies
- Optimization of procurement practices
- Bundling of services
Adoption of technology
Suppliers of loyalty programs are adopting beacon technologies such as Bluetooth low energy (BLE)-based technology, which enables device-to-device communication based on location.
Suppliers also offer various loyalty software platforms and blockchain technology facilities to centralize and manage the loyalty program.
Adoption of negotiation strategies
Value additions such as assistance in branding and consulting services are key factors that buyers consider before choosing a supplier’s services. These value-adds can save up to 10% of the total category spend to buyers.
Buyers in the global loyalty programs market focus on using data management systems, omnichannel loyalty, smart loyalty programs, and training internal staff.
Bundling of services
Suppliers of loyalty programs often bundle together services such as the implementation of omnichannel loyalty, installation and maintenance of POS hardware and software, and provision of loyalty membership cards. The bundling of these services not only ensures more consumer interaction for suppliers, but also the enlistment of more services at a lower cost to the buyer.
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Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.
Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, resellers, and end-users.
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