How is the loyalty industry evolving in the GAS region?
22 Mar 2022
As part of our Q&A series in Germany we recently sat down with Patrick Bacher, Commercial Director for Germany, Austria and Switzerland to learn about how he sees the loyalty market and industry evolving. Patrick discusses the impact loyalty campaigns
Could you tell us a little bit about your role and responsibilities at tcc?
As a commercial Director for the tcc business region GAS (Germany, Austria, Switzerland) I am responsible for the overall business in the region and for our client-facing teams, which are: Sales, Marketing, our kids & family campaign specialists as well as our program management and community campaign team. My day-to-day is very operational. I aim to join as many client meetings as possible whilst also making sure we are constantly developing and delivering strong loyalty campaigns that make a real difference to our clients business, raise their turnover, change how shoppers perceive their brand and create a positive Return on Investment (ROI) and Return on Emotion (ROE) for them.
As a C-Level marketer, what do I need to know about what Loyalty programs can do for my business in 2022?
Retaining the good & very good customers and making sure that they choose “your” store over the competition (online or offline), is one of THE permanent key challenges for our retail clients. Our loyalty solutions can play an integral part in winning this “fight for the trip” short and long term. Our loyalty campaigns are changing the way shoppers think & feel about a retail brand as well as it directly influences their day-to-day shopping behaviour in a sustainable and meaningful way.
How has the pandemic changed the way you do your job/tcc creates its loyalty campaigns?
As many businesses have had to do during the pandemic, we have learned to work completely remote, with all the positives and negatives this brings. tcc is an international company so we are used to working in international teams. In a digital working environment, this has been even easier to do. With many of our clients also working from home we have got used to meeting them digitally. With that being said, we have enjoyed every physical meeting during the last two years more than ever before.
How do you see the industry evolving over the next 5 years?
Sustainability as a major/global trend will continue to change the way we design our platforms and campaigns. tcc has been focussing on this topic a lot over the last few years. To date more than 30 of our rewards solutions/line-ups are made sustainably and we are constantly growing that number.
In addition, we will see more and more purpose-led campaigns. As the market-leading experts in the area of “Community Campaigns” we strongly believe that this type of loyalty campaign model will continue to grow, and we are also sure that it will last.
The need for tailormade campaigns, built to fit into the marketing strategy of our retail clients will continue, as well as ongoing digitization.
How does the GAS region compare to other loyalty markets?
When we are developing loyalty platforms and campaigns for our clients, we are always considering the general shopper and market trends (which includes regional trends), but also the individual retailer, their strategy, their targets and positioning. Sometimes this leads to campaigns with a similar focus compared to other markets, but sometimes it also leads to something very specific and unique which would never work outside of the respective retailer.
What can grocers do to show more empathy with their customers?
There are certainly many ways to achieve this. Looking at the world of loyalty marketing we know that well-designed loyalty campaigns in which shoppers are being gifted with a free reward for shopping regularly with a retailer are changing the way shoppers perceive the retail brand. Our campaigns bring a lot of excitement. Shoppers really enjoy collecting, getting closer and closer to their desired target any time they shop until they can finally hold the reward in their hands. This does not only create a moment of joy, happiness and pride (really having achieved something), but also changes the way shoppers see the retailer because they feel really valued for their loyalty.
We know from a lot of research we have undertaken over the last 30 years that participants of our campaigns still remember where and how they received a reward from a loyalty campaign even years after they have collected it. And these are just two out of many examples of how our loyalty campaigns strengthen the emotional bond between a retailer and their customers.
What are some of the most common issues when it comes to delivering relevant offers/rewards and maintaining a quality loyalty program?
The two most important success factors for any loyalty campaign are:
- A compelling and relevant shopper offer (with a stretching spend requirement and a “free”, or “almost free” reward)
- Execution in store
Great POS decoration, high visibility of our rewards displays (in a high-frequency aisle) and most importantly a good execution from the cashiers are key drivers for the success of any loyalty campaign. Everything starts from awareness and cashiers are playing a vital role because they are seeing every customer personally and should hand over stamps, or instant rewards directly to the customers every time a customer enters the cash desk. This is easily said but very hard to achieve and could become a real issue for a campaign if not well implemented. That’s why we are undertaking many steps together with our clients during the preparation of each campaign to make sure that the campaigns get the best possible advertising and in-store execution.
With consumers becoming more concerned with sustainability, how will you be placing greater emphasis on loyalty with purpose?
tcc has just recently joined the UN GLOBAL COMPACT, another important step in the history of tcc that solidifies our mission to be a force for good and that substantiates our position as a leader in sustainable loyalty solutions. As said before: tcc has been focussing on sustainability already a lot over the last years. Many of our rewards solutions/line-ups are made sustainably and we are constantly growing that number. We are taking a more circular approach that focuses on reusing materials and using renewable materials where possible. More sustainable products are becoming the norm. It’s expected – if not mandatory in some cases. Retailers want to see local or sustainable products that will have a positive impact on their communities. A few years ago, we offered one or two ranges that had strong sustainable credentials. Now they form over a quarter of our portfolio. In terms of sourcing, we are increasingly producing in Europe. Ideally, we want to give local waste a new life – for example, procuring fabrics made from recycled plastic bottles, or recycling cans into cookware. So, we are designing more durable products, and we pay a lot of attention to the packaging we are using. Where we still use plastic, we strive to use recycled content. We have reduced our packaging use by 122 tonnes compared to 2019 and are pushing to remove plastic everywhere we can.
Another great example of “loyalty with purpose” is our Community Campaigns. In such campaigns, retailers support local communities, such as Schools, or Sports Clubs through a loyalty campaign. Shoppers collect Community Vouchers in-store and donate them to the Community of their choice. Later, the Communities can redeem their vouchers for free rewards, like IT equipment, sports material, or many other types of rewards. Such campaigns create very strong emotional bonds and connections with shoppers on the very local level, which is crucial for every retailer. It’s a wonderful way for a retailer to run a really purpose-led campaign.