Customer Loyalty Remains Top Priority For UAE Retailers, Says Yegertek CEO – News
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As e-commerce takes hold in the UAE, retailers are rewriting the rules of marketing.
Brands in the region are implementing effective marketing strategies to build customer loyalty, which paves the way for innovation in marketing. As the UAE is extremely competitive with local and global brands, retailers are compelled to study consumer behavior and come up with solutions that will help them retain customers.
“Competitive markets characterize opportunity if you have the right tools of the trade. Internet penetration in the UAE is 99%, the highest in the region. So naturally there is the proliferation of data, which is the playground of purpose-driven brands. These companies share an enthusiasm for technologies that can help them better understand their customers, deliver actionable insights, segment and hyper-personalize. After analyzing a number of data, including but not limited to shopping behaviors, purchase history, channel preferences, and demographics, brands gain insights that can enable them to meet unique customer requirements. Such experiences put the onus back on the customers, thereby generating their loyalty,” said Sajid Azmi, Founder and CEO of Yegertek, a solution provider s based in Dubai in brand engagement and customer loyalty.
Sajid Azmi, founder and CEO of Yegertek. — Photo provided
“Our expertise and value proposition lies in orchestrating omnichannel, cross-platform, data-driven customer loyalty programs. Our custom rules engine tracks customer behavior across all channels and effectively rewards each user. Derived business intelligence enables brands to streamline their merchandising, in-store operations, product placement, and more, in online and physical models. Most importantly, these one-stop-shop offerings are customized and made available to brands in industries as diverse as hospitality, restaurants, e-commerce, B2B, B2C, and more, keeping in mind the ubiquity of digitization,” he said. added.
In a hyper-connected world, a crisis creates both opportunities and challenges. The Covid-19 pandemic was no different – it put digitalization on hot wheels, impacting the traditional order of commerce. Initially, the economic impact of digitalization was obscure due to the moderation in consumer spending. After reopening, however, people are back in the market and researchers have plenty of data to work with. It turns out that shoppers aren’t spending like they used to. According to McKinsey, 95% of consumers in the UAE have changed their buying behavior. Of particular note is their newfound affinity for e-commerce.
As e-commerce takes hold in the UAE, retailers are rewriting the rules of marketing. Chief among the focus areas is customer retention, which is the result of a strong relationship with brands, which is critical to long-term success. Digitization has not only upended traditional notions of loyalty, but also increased purchasing options, making it harder to retain customers.
“Loyalty was never given to begin with; it was nurtured by effective customer engagement across omnichannel touchpoints. Today, with e-commerce taking precedence, merchants need to build loyalty with greater technological assistance,” Azmi said.
Loyalty trends in the UAE
Loyalty should go beyond financial incentives
Programs that reward loyalty with financial benefits such as cash back and rebates are still popular in the UAE. However, with customers now exposed to a multitude of options online, loyalty strategies need to be more than transactional, rewarding shoppers for their non-transactional behavior. Brands that embrace this approach give out random prizes, reward shoppers for completing surveys, offer the option to donate a portion of their spend to charities of their choice, and more. More importantly, brands create exclusivity. For example, LinkedIn Premium and Mastercard’s World Elite, which tap into customers’ innate need to feel exclusive and special. There is a FOMO effect that accompanies loyalty programs with exclusive perks. Such programs enable lifecycle customer engagement because of their design.
Customization is non-negotiable
“Many reliable studies have established that customers are willing to pay extra for personalized shopping experiences and services. However, in a crowded industry like retail, success depends on your ability to hyper-personalize your customer engagement, at scale – which requires cutting-edge analytical tools and in-depth analysis of every bit of behavioral data. shoppers buy online,” explained Azmi. This belief was echoed in a recent KPMG survey, in which personalization was selected as the top determinant of loyalty by respondents in the United Arab Emirates.
Cookie-cutter strategies run the risk of disengaging existing customers, causing them to seek alternatives. Customers expect the brands they spend on to demonstrate how well their unique needs are recognized and the products/services are tailored to their expectations. In a country like the United Arab Emirates, with 99% internet penetration, the expectations are very particular and eclectic.
CSR as a loyalty lever
Empathy comes second only to personalization as a driver of loyalty in the aforementioned KPMG survey. In the wake of the pandemic and its accompanying impact on health, consumers are increasingly turning to brands that demonstrate compassion in their messaging and content. Brands that strike the right chord with customers can inspire loyalty in return. In addition, in the meantime, customers have become aware of environmental issues and the imperative of sustainability. They consciously look for brands that align with the broader desire for sustainable development and socio-cultural evolution. Additionally, digitalization has ensured transparency for brands in their CSR efforts. Therefore, empathy-based customer engagement and measurable CSR activities are becoming commonplace in the retail ecosystem.
UAE’s tech orientation complements e-commerce boom
About 45% of respondents in the aforementioned McKinsey survey intend to spend online even after the pandemic. This subset represents a customer base that is not particularly loyal to a brand; they are exploring their options. Retailers can capitalize on this untapped opportunity through the adoption of marketing automation, sophisticated data analytics, and customer management solutions. “Retailers may not have selected standalone technologies for customer engagement and loyalty – technology silos prevent retailers from maximizing positive outcomes. Comprehensive customer management solutions that consolidate omnichannel customer data points and provide actionable insights for hyper-personalization will be best positioned to differentiate in the crowded retail industry,” Azmi said.
“Metrics such as customer lifetime value (CLV), customer retention rate and share of wallet will continue to be relevant in the loyalty space, but how they are measured and used will change” , he concluded. — [email protected]