Is your loyalty management agency overcharging you?

Let’s be honest, it’s extremely difficult to win customer loyalty in the modern digital age where customers have a plethora of options to choose from. But in spite of this, enterprise brands across industries are seeing more and more value in loyalty programs. Why? Because of advanced financial modeling and tapping into human psychology. Loyalty management experts have figured out the right balance where customers have a reason (and emotion) to keep coming back to a brand and at the same time, brands can build on loyalty as a business line. 

The agency-led loyalty marketing model is getting disrupted by SaaS

In the USA and Europe, over the last couple of decades, legacy agencies and consultancies have dominated the loyalty marketing industry. These firms are good at designing loyalty programs and thinking through a problem statement but in this age of AI, they severely lack the technology know-how and depend on 3rd party vendors for implementing a program. And this is where the problem starts. 

Massive costs of technology- Why do loyalty management agencies charge so much? 

Let’s take some real-world examples- 

1. Early in September, a conglomerate in the USA wanted to go live with multiple employee offers, 25+ promotions (including cashback deals), and a game – all in one day. They went to their agency which quoted $250K as a change request on developing and delivering these promotions by coding on the platform. And, it’d take 3 months to make these changes! 
2. One of the top retailers in the USA wanted to kick-start their loyalty program. On an agency model, it took them more than 30 months and cost them upwards of 6 million USD to go live. The time and amount are enough to bootstrap an entire loyalty technology company! Partnering with existing SaaS-based loyalty platform vendors would have enabled this fuel retailer to go live in a matter of 6 months and at a fraction of the cost!
3. One of the largest hotels globally wanted to add a new Tier to their loyalty program. This can be done without any cost on a SaaS platform but the agency they were working with charged the hotel 300K USD along with a 4-week timeline to implement! We’re in an age when technology can help brands do this instantly and platforms like Capillary are built in a way that all of this flexibility is built-in the product. 

Why and how SaaS is the way to go for loyalty marketers

The last decade has been the decade of SaaS (software as a service) for a reason. As a brand marketer, your role is to ensure your customers receive the best experience while shopping with you and that they keep coming back to you. Along with this, the company should meet its business objective. For this, it is essential for brand marketers and loyalty marketers to spend more and more time with their end customers, designing campaigns, creating new trends, and ensuring customers get what they want. And technology should be an enabler in this. 

But what ends up happening while deploying and running loyalty programs is that teams responsible for handling loyalty end up wasting too much time on understanding technology and ensuring that the program functions! 

This is where the beauty of SaaS comes in: At Capillary Technologies, we’ve worked with more than 250 enterprise brands across the globe including a range of verticals (Shell, Tata, Domino’s, Al-Futtaim Group, Puma, NASCAR, and many more). In this process, we’ve taken intelligence from all these programs and it is already baked into our AI-powered loyalty technology platform which has a holistic product roadmap. With Loyalty+, Engage+, Rewards+, and Insights+ – the product suite that is powered by a robust consumer data platform, brand marketers get the perfect SaaS solution through which they run agile and flexible loyalty programs.

What’s special about the Capillary platform? 

Along with Brierley’s consultancy services, the Capillary platform is perfectly suited for running end-to-end loyalty programs at scale that deliver real ROI. Some of the key areas where Capillary truly distinguishes are:

• Create custom, targeted, and region-specific offers and promotions (while allowing each region to control point liability)
• A truly multi-tenant solution (Features built with configuration to rollout across tenants vs update and test for each client. Upgrades are easy, automatic, and seamless)
• Go live quickly and easily with Capillary’s extensive technology integrations
• AI-powered personalization (AI algorithms help tailor offers and rewards to individual customers, increasing redemption rates and driving customer loyalty)
• Highly secured and data-privacy-compliant platform
• Global presence with expert consultancy (with offices and physical presence in different regions, Capillary truly understands the regional nuances)

Conclusion: the reason why agencies have to charge as much

An agency-led model in loyalty management is good for consultancy but when it comes to technology, they will have to charge through the nose because everything has to be built from scratch, again and again. Every time a new requirement or situation shows up, the technology that would enable the change would have to be built and we all know how expensive quality developers are. 

In this situation, it is a no-brainer for brands to switch to a SaaS-based loyalty platform where you have a ready-made product roadmap with a lot of flexibility and agility that allows you to run winning customer loyalty programs.

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Jubin Mehta is the Associate Director of Marketing at Capillary Technologies. He is a full stack marketer with 10+ years of experience as a tech journalist and B2B SaaS marketer. Also a meditation instructor, he is a proponent of non-dual philosophy. He can be reached out on Twitter @jub_in.