How Digital Loyalty Programs Are Revolutionizing Retailers Engagement in India?

By Ayush Jhawar

With retailers playing a significant role in building brands, offering digital loyalty programs can prove to be a game changer for businesses across industry verticals.

Digital Loyalty Programs (DLPs) are growing and for a good reason. Especially for building strong relationships between firms and channel partners, their role is assuming strategic prominence. Powered by tech-driven platforms, DLPs use QR codes and mobile apps to offer personalized rewards to channel partners. DLPs also increase operation efficiency by equipping value chain players with better efficiency and reduced wastage. If you struggle to boost channel engagement, then the striking benefits of the DLPs mentioned will convince you to take a plunge:

a) Incentivising Partners: DLPs encourage channel partners to do “Repeat Business” with brands – Repeat being the operational word here. By rewarding retailers for their past and ongoing purchases, firms can retain them, cultivate business relationships, and earn brand loyalty in the long run. Research studies have shown that firms with stronger relationships with partners often lead their segments by emerging as a preferred choice of customers. Further, the completely automated nature of these reward systems ensures that the entire process of collecting and redeeming loyalty points remains a hassle-free experience.
b) Personalized Rewards: Data-driven DLPs deliver personalized rewards matching the preferences of retailers in terms of “what”, “how”, and “when” they want their rewards to be redeemed. This tailor-made approach is significant in deriving maximum benefits from DLPs and building long-term relationships among partners. This personal touch is also essential to remain competitive and set new benchmarks for delivering superior value to retailers and channel partners. Once channel partners start feeling confident in firms, they double down their efforts to reach customers, offer superior service, and act as a strong link between the firm and customers.
c) Collaborative Opportunities: DLPs shouldn’t be seen only from the context of automating rewards and building stronger relationships. Rather, these programs also offer larger collaborative opportunities to drive innovations, create touchpoints, and build capabilities. Firms and partners, when working in cohesion, better understand their target markets and create superior value throughout the business ecosystem. Synergies are created when firms and partners work in unison which opens new opportunities besides making the entire ecosystem competitive and dynamic. This exploration is also necessary to confidently face the challenges now posed by the dynamic nature of market forces that keep on changing at a very high pace.
d) Superior Tracking: DLPs use QR codes and tech platforms to automate loyalty programs. Besides automating reward systems, this tech equips firms and retailers with superior tracking capabilities. From sourcing materials to dispatching products and stocking retailers, businesses can closely monitor their supply chains to achieve superior operational efficiency. The tracking also allows firms to check the menace of counterfeit products which cause serious damage to the brand image of firms. In other words, DLPs can also catalyse the digital transformation of firms and partners by mandating technology integration in the value chain activities.
e) Cross-selling and Upselling: Firms with strong DLPs can encourage partners to stock cross-category products for better reach and larger market share. Similarly, premium product stocking can also be encouraged as rewards associated with higher-order products are higher. This intensified collaboration increases the lifetime value of retailers and helps firms realise long-term business sustainability. Channel partners, on their part, also benefit as migration of customers to specialised products will also help them achieve better margins in comparison to regular, run-of-the-mill products.

DLPs are revolutionising the retail industry – in more ways than one. They help firms engage with partners by automating the collection and redemption of loyalty points. These programs offer personalised rewards aligning with the specific preferences of channel partners. DLPs also equip the entire business ecosystem with superior tracking capabilities, resulting in better operational efficiency and reducing wastage and costs. With such multifaceted benefits on offer, it won’t be an exaggeration to conclude that DLPs are changing the tenets of the relationship between firms and their channel partners and will completely transform the business ecosystem in the coming years.