ILoyalty and customer engagement plus retention, are becoming increasingly important factors in the unfavourable market developments and increasing competition.
The dedicate institute at the University of Parma, is the first of its kind in Italy. Its first report was based on 500 different Italian companies including manufacturing, distribution and services.
The study did not only focus solely on creating loyalty programs, but also different CRM formats and personalised offers. The institute considers “mass loyalty” for actions targetting the general client base while “personalised loyalty” is based on client profiling.
The market is made up by 16 different types of suppliers: rewards and prizes, communications agencies, technologies for analytics, digital engagement, eCommerce and mobile commerce and many others; all in addition to the standard loyalty platforms.
The global market for loyalty services and products is estimated to grow by 15-20% in the next five years. Yet, Italy seems to be excluded from this prediction; ten years ago, half of industry workers did not exist and companies still struggle to find the right partner for their strategy.
On average, Italian companies spend between 30 to 70%, depending on the industry, of their marketing budget on customer loyalty; with 42% of the budget used to purchase products and services.
Investments between mass and personalised loyalty have become close to equal again, at 26% and 21% respectively; noticeably, personalised loyalty has been absorbing increasingly more resources. In retail (categorised as one with food and non-food products), expenditure went from 4% in 2011 to 20% in 2018.
The spotlight remains on CRM as 38% of investors consider it the most important investment. It is closely followed by mapping services and customer journey/experience analytics, supported by 25% of investors. Thirs place is taken by mobile marketing with 24% of votes.
Precautions and delays
Marketing automation and eCommerce are considered a priority by less than 20% of investors, while even fewer are those investing in content marketing and content automation with chatbots.
After the institute’s study, 95% of the companies will change their loyalty strategy in the course of the year, with 46% action on personalisation and client recognition through various touchpoints (especially in non-food retail).