Hotel occupancy rates at 80% were the highest in the region
Innovation and evolution are constants in the dynamic fintech landscape. As we delve into 2024, three prominent trends are poised to reshape the financial technology landscape, offering exciting prospects for consumers and businesses alike.
1. Loyalty and cashback programmes
The evolving loyalty cashback sector is capturing attention with its exponential growth trajectory. Research reveals a Compound Annual Growth Rate (CAGR) of 11.8 per cent from 2019 to 2023, indicating its rising prominence. This trend is set to persist, with projections forecasting a robust CAGR of 9.2 per cent from 2024 to 2028. With consumers increasingly seeking value and rewards from their financial engagements, loyalty cashback programmes present a compelling proposition. They foster brand loyalty while offering tangible benefits to users, such as increased purchasing power and enhanced customer experience.
Loyalty programmes have traditionally relied on a generic reward system, pushing the same offers to everyone. However, today, data-driven insights are changing that mindset. By analysing transactional data, businesses gain valuable insights into customer behaviours, enabling the creation of targeted and relevant rewards that resonate with each unique customer segment.
2. Leveraging predictive analytics and AI
As society moves towards a more technologically advanced era, businesses also adapt. By incorporating artificial intelligence (AI) and predictive analytics, fintech platforms that offer customer retention and loyalty solutions help businesses transform their operational efficiency by leveraging relevant data that allows for strategic planning. Moreover, AI enables access to prompt support and steadfast access to relevant information, allowing businesses to provide effective service that aids in customer loyalty.
Integrating data-driven loyalty programmes is rapidly emerging as a dominant trend in the business landscape. Businesses are increasingly harnessing sophisticated data analytics to offer personalised rewards experiences that resonate with unique customer preferences. This trend highlights a shift towards enhancing customer engagement through strategic rewards, leveraging predictive analytics to anticipate prospective customer behaviours and preferences. As companies recognise the value of fostering a sense of exclusivity and personal connection, adopting data-driven loyalty initiatives continues to gain momentum, positioning it as a key strategy for driving customer satisfaction and loyalty.
3. Customer retention vs. acquisition
Another evolving trend to note is the debate between customer retention and acquisition gaining prominence. While the allure of acquiring new customers persists, businesses are increasingly realising the substantial cost differentials between retaining existing clientele and courting fresh prospects. Factors such as brand loyalty, marketing expenditures, and resource allocation significantly impact this balance. Loyal customers are more likely to respond positively to upselling or cross-selling products, spending 31 per cent more than new customers due to their familiarity with the brand.
Existing customers are also 50 per cent more inclined to explore new products. Therefore, businesses can effectively pitch new products, add-ons or upgraded subscriptions to long-term consumers. Moreover, the prolonged duration before a new customer becomes profitable underscores the importance of nurturing long-term relationships. Studies suggest that acquiring a new customer costs five to seven times more than retaining an existing one. As businesses realise this, they are gearing up to encourage customer retention, which results in customer loyalty. To achieve this, businesses collaborate with fintech platforms supporting this vision.
By leveraging data analytics and predictive modelling, they aim to identify high-value customers and optimise retention efforts, ultimately driving sustainable growth and profitability in the competitive fintech sphere.
The writer is CEO and Co-Founder of TOTL.
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