In the past, rewards and savings have been what members value most about their loyalty programs, in line with the biggest purchase drivers for value-minded consumers.

But the pandemic has made more people realize the value in the shopping experience, which has corresponded with a flip in loyalty programs as well: most people value experience and relevance over saving a few dollars, with customers willing to pay a premium for getting that from a company that they can trust.

Phil Rubin, EVP of global insights and strategic partnerships at Bond Brand Loyalty, explains that, in the past, reward programs gave customers financial benefits for purchases, with the most successful ones - according to previous editions of the company's annual Loyalty Report - being those that made it easier to earn and redeem those benefits.

That approach made sense when consumers valued price and savings over all else, and still remains important. Because with more emotions now attached to transactions, today's consumer, Rubin says, is looking to make purchases that are more in line with their values and support their morals.

In response, companies have to move beyond the basics of rewards and financial benefits, and have to create better customer experiences. Loyalty marketing and loyalty programs, he explains, should show customers "that you know them, remember them and engage them."

For example, both Petro-Canada's Petro Points and the PC Financial Mastercard ranked highly in loyalty in this year's Loyalty Report, with both having a simple-to-use program that made it easy to earn points and delivered benefits directly. However, Petro Points ranked highly on loyalty to the brand itself, not just to the program, thanks to messaging and interactions that tied back strongly to Petro-Canada's overall brand and made members feel appreciated. The PC Financial Mastercard, on the other hand, ranked low on other brand loyalty metrics, as it feels highly transactional, especially when compared to the kind of messages and interactions seen in the PC Optimum program.

"Really all content marketing is the conversation that you have with a shopkeeper, or with that local small business merchant, but at a larger scale," says Rubin.

While larger big box retailers can't strike up similar conversations with millions of people the way smaller shop owners can, companies can use data collection methods to gain a better understanding of what consumers are looking for.

"It's a very simple idea, to pay attention to customers you collect data with their permission, and get them to not just opt in, but opt up and use the data to serve them with a better experience with more relevant communications, while protecting their data and building their trust. Remembering who they are, remembering their preferences, and acting on those preferences," says Rubin.

Most companies also overestimate how they are perceived with customer centricity, when what consumers are really looking for is a business that they can trust. The path to purchase is determined by consumer trust, which is determined by an emotional and non-transactional experience. Loyalty marketing is defined, very simply, as paying attention to customers and treating them accordingly.

"Missteps happen and brands don't have to be perfect, but they need to make sure that when those things happen that the customer knows that they recognize it and will address it," Rubin says.

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