It seems that every supermarket and store in the UAE has a loyalty programme these days. ICLP, a global loyalty company, has had a presence in the Emirates since 1996. Priyanka Lakhani, the loyalty planning and business development director of ICLP Dubai, speaks about research the company conducted into the industry here.
How advanced is the loyalty industry in the UAE compared to other markets?
It's remarkable just how much has been achieved in a short space of time considering that the first internationally comparable points and rewards programme were only launched in the region just over a decade ago. Present loyalty initiatives enjoy widespread understanding and acceptance by business and consumers in the UAE and GCC, with arguably some markets fast approaching saturation point in the number and scale of rewards programmes that are on offer. We recently conducted research with Forrester in five key markets - UK, US, China, Brazil and India - which was then executed in Saudi Arabia and UAE.
To understand what customers expect from brands they are loyal to and how brands are delivering against those expectations.
What did it tell you about consumers in the UAE?
While insights are under development, some early findings suggest that price, quality, service and trust continue to be the key driver for consumers. However, when it comes to loyalty, loyalty to a brand is not always a guarantee of future commitment. Brands need to work hard to drive ongoing loyalty. This was observed equally in the UAE and Saudi Arabia and other international markets but is less prevalent in emerging markets where customers are willing to even pay a price premium for products and services of brands they are loyal to. Equally, customers in emerging markets are keen to communicate with brands through their social pages.
How does the UAE compare in this?
While customers in the UAE and Saudi Arabia prefer digital communications, they are less willing to communicate with brands through social media. There customers want to see instant rewards delivered preferably through their mobile handsets with flexibility to choose their rewards. They expect brands to communicate with them through their preferred media. Relevance in messaging, offers and otherwise is one of the key expectations of the consumers in UAE and Saudi Arabia - a trend that already exists in other markets, where market size and competition demands it.
How much is the industry worth here? Is it projected to grow?
Official metrics that measure and evaluate the value of the loyalty industry in the Middle East do not exist. However, loyalty today is an integral part of most consumer businesses either in the form of reward incentive programmes or unpublished customer care and benefit programmes. Today, every major airline, hotel, bank, retailer and telecommunications operator has a loyalty programme and many more players within these sectors are planning to launch their initiatives, suggesting that the industry is growing, and growing fast.