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Trends & Insights

The Loyalty Boom in Saudi Arabia: Trends, Challenges, and How Brands Can Stay Ahead

Explore the booming Saudi loyalty market with insights on emerging trends, challenges, and strategies. Learn how brands in Saudi Arabia are leveraging hyper-personalization, instant rewards, and value-driven programs to capture customer loyalty and drive business growth.

By

Anjali Pillai

4 Min Read

November 06, 2024

Saudi Arabia is on a mission with Vision 2030, transforming into a cashless, digital powerhouse—and the loyalty market is feeling the buzz. Even the government has joined the party with DOAM, a loyalty program that’s shaking things up for over 1.2 million public sector employees. The DOAM program allows employees to enjoy exclusive offers, such as discounts on flexible domestic fares, special deals on international flights, and curated travel packages. 

 

This marks a shift not just in the public sector, but across industries like e-commerce, retail and travel and hospitality, where businesses are increasingly using loyalty programs to forge lasting customer relationships.

 

The Saudi loyalty market grew at an impressive CAGR of 11.6% between 2019 and 2023 and is forecasted to reach USD 1.59 billion by 2028. What’s fueling this exponential growth? A combination of technological advancements and evolving consumer preferences. Brands are beginning to recognize that loyalty programs are no longer a “nice-to-have” but a strategic imperative to drive business growth and stay competitive.

 

The Shift in Saudi Loyalty Programs: It’s All About Experiences and Value

 

If you think points and discounts are all you need to get a jump start in this booming market, think again. With over 60% of the population under 35, there’s a massive demand for digital-first, innovative products and experiences. Today’s Saudi consumers crave meaningful connections, memorable experiences, and real-time value. Brands must rethink their loyalty strategies to stay ahead and meet these evolving expectations.

Saudi Loyalty Market

Trends Shaping Loyalty Programs in Saudi Arabia

 

1. Experiences Over Marginal Discounts

 

Discounts and offers are no longer sufficient to build loyalty. Today’s consumers expect curated experiences that make them feel special. Programs like Saudi Rewards are leading the way by allowing members to earn and redeem points across a wide network of tourism events, travel deals, dining experiences, excursions, and entertainment. This creates an emotional connection with the brand, turning customers into advocates.

 

To stand out, brands must move beyond transactional incentives and design loyalty programs that offer exclusive dining experiences, personalized getaways, or VIP access to events. The focus should be on creating moments that matter—moments customers won’t forget.

 

2. Sustainability: Aligning Loyalty Programs with Consumer Values

 

Sustainability is becoming a non-negotiable in the Saudi loyalty market, and conscious consumerism is becoming a key trend in the region. Customers are increasingly drawn to brands that show a commitment to social responsibility and environmental consciousness. Loyalty programs that integrate sustainability—such as eco-friendly rewards, carbon offset incentives, or green points systems—appeal to this growing segment of conscious consumers. 

 

3. Instant Gratification: Rewards Without the Wait

 

Don’t keep them waiting. With instant gratification becoming a key engagement factor, Saudi consumers expect quick rewards making cashback programs more popular than traditional point-based rewards.

 

Some instant gratification strategies that brands can consider: 

  • Cashbacks within minutes of purchase.
  • Instant vouchers that can be redeemed in-store or online.
  • Real-time notifications about points and rewards earned, keeping excitement levels high.

 

In the booming Saudi loyalty market, brands that deliver rewards swiftly keep customers engaged and motivated to make repeat purchases.

 

4. Value-Driven Rewards: Catering to Price-Conscious Consumers

 

Recent research from Saudi Arabia Consumer Behavior in the New Era shows that Saudi consumers are becoming increasingly price-sensitive and value-conscious. This has heightened the need for Saudi loyalty programs that offer meaningful discounts, bundled incentives, and high-value rewards.

 

Brands should focus on combining price savings with aspirational rewards—for instance, a loyalty program that offers both discounted shopping vouchers and exclusive experiences ensures customers feel they are getting the best of both worlds.

 

Challenges in Building Loyalty Programs in Saudi Arabia

 

Despite the growing demand, building and managing loyalty programs in Saudi Arabia is not without its challenges. Brands must navigate the following hurdles to ensure their programs remain relevant and compliant.

 

1. Regulatory Compliance

 

The Saudi government is introducing new regulatory frameworks focused on data privacy, payment security, and consumer rights. With loyalty programs requiring access to personal data, it’s crucial for businesses to align with these evolving regulations.

 

Non-compliance risks damaging brand reputation and customer trust. Brands must balance personalization with privacy by being transparent about how customer data is collected and used. 

 

2. Changing Consumer Expectations and Behaviors

 

Customer behaviors in Saudi Arabia are evolving rapidly. While digital adoption, mobile shopping, and social commerce are reshaping how consumers engage with brands, building long-term loyalty is becoming more challenging. Younger demographics, in particular, are driven by deals, promotions, and instant gratification, leading to low customer stickiness. To stay competitive, loyalty programs must offer seamless omnichannel experiences and deliver relevant, personalized rewards that go beyond discounts to foster deeper, lasting connections.

 

How Brands Can Build Loyalty Programs That Resonate in Saudi Arabia

 

Succeeding in Saudi Arabia’s evolving loyalty landscape means putting customers at the heart of your strategy. It’s about creating programs that resonate with local preferences and align with what customers truly value. Here’s what can make a difference:

 

1. Localization and Cultural Adaptation

 

Loyalty programs that reflect regional traditions and cultural values resonate more deeply with Saudi consumers. Hence incorporating localization features that speak directly with the consumers can make a huge difference in building an emotional connection with them. While the foundational element of localization is of course the use of regional language across platforms, it is not limited to it. Localization in your loyalty program can also consider: 

 

  • Celebrate key moments by offering rewards around holidays like Ramadan and National Day.
  • Create family-friendly incentives that align with Saudi values.
  • Provide bilingual support (Arabic and English) across platforms to ensure seamless engagement for all.

 

2. Customer Experience and Digital Engagement

 

With digital advancements playing a major role in driving the loyalty market in Saudi, brands need to consider different innovative ways to engage their customers. Gamification could be a great way to start. Gamification features—such as milestones, badges, and challenges—boost engagement and encourage repeat interactions.

 

By integrating the omnichannel experience into your brand’s loyalty program, you can make sure that you are connected with your customers at every touch point and can engage with them wherever they are and how they might prefer. 

 

3. Hyper-Personalization at Scale

 

If your brand wants to stand out and truly connect with customers, hyper-personalization isn’t just a nice-to-have—it’s essential. It’s not about simply using a customer’s name, age, gender, or location; it’s about engaging them through their unique preferences based on their purchase history, customer journey, etc, and delivering messages that resonate on a personal level. In order to implement hyper-personalization, brands can: 

 

  • Use AI-powered analytics to deliver personalized product recommendations.
  • Create dynamic rewards that allow members to select the incentives they value most.
  • Run targeted campaigns during holidays and key shopping events, delivering relevant offers in real time.

 

4. Advanced Analytics to Stay Ahead of Trends

 

Customer expectations keep changing and that’s a given. Navigating these changing customer expectations is a major challenge that brands face, but there’s a solution. Brands that leverage advanced analytics can anticipate emerging trends and stay ahead of changing consumer behavior. Predictive analytics can help brands identify opportunities to improve their loyalty programs and deliver more meaningful rewards, thus creating a delightful experience for their customers. 

 

5. Partnerships for Cross-Brand Rewards

 

Saudi Loyalty Market Trends

Collaborating with complementary brands opens new avenues to engage customers by offering richer, more meaningful rewards. In Saudi Arabia, cross-brand loyalty ecosystems are gaining momentum, with notable examples like Saudi Arabian Airlines (Saudia) partnering with retail brands and hotels through their Alfursan loyalty program. Similarly, STC Pay collaborates with retailers and restaurants, providing discounts and rewards that enhance everyday transactions for users.

 

These partnerships create seamless ecosystems—airlines, hotels, retail chains, and financial services working together to offer customers more value. This approach makes it easier for members to earn and redeem rewards across multiple touchpoints, enhancing their loyalty journey with incentives that fit their lifestyle.

 

Winning Loyalty in Saudi Arabia With Innovation and Adaptation

 

The loyalty landscape in Saudi Arabia is expanding rapidly and the demand for personalized, meaningful experiences in the region is now higher than ever. To stay ahead, brands need to act fast, leveraging this momentum to transform loyalty programs from cost centers into profit engines. But why do the heavy lifting all by yourself when you can partner with the right loyalty solutions provider? With the right loyalty partner offering the expertise, tools, and scalability to design impactful programs, brands can achieve measurable results and position themselves to thrive in this dynamic market.

 

At Capillary Technologies, we specialize in building adaptive, scalable loyalty programs that meet the unique needs of regional markets. With our deep expertise in AI-powered personalization, gamification, and omnichannel engagement, we help brands design loyalty strategies that resonate with Saudi consumers and deliver real business impact.

 

Is your loyalty program ready to unlock the potential of the Saudi market? Let Capillary help you build the perfect strategy to drive long-term success. 

 

 

Anjali R Pillai
Anjali Pillai

With a knack for creating engaging content and crafting effective social media campaigns, Anjali wants to make it her mission to leverage the power of content as a strategic marketing tool for businesses. While she is not working, she is either binging movies or writing about them on her blog.

With a knack for creating engaging content and crafting effective social media campaigns, Anjali wants to make it her mission to leverage the power of content as a strategic marketing tool for businesses. While she is not working, she is either binging movies or writing about them on her blog.

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