Signal’s Prediction for Digital Marketing in 2016: Coalition Loyalty Programs Will Open Doors to More Valuable Second-Party Data

Loyalty programs are the backbone of many brands’ marketing strategies, and it’s easy to see why. Not only can they gain increased customer spend and frequency, they can also gain incredible customer intelligence.

That’s because consumers are conditioned to share data in some form or another in order to get something in return. It’s the rule, not the exception, for most loyalty programs to be activated through a mobile number or an email address (i.e. a personal identifier). Consumers justify this exchange in the name of simplicity and rewards – they have fewer cards to carry and get more points, prizes, coupons or access in return. And brands reap the benefits of repeat purchases while enriching their first-party data.

This exchange of data for rewards is nothing new, but in the upcoming year, we will see more brands coming together to offer consumers more appealing rewards and build even bigger pools of data through coalition loyalty programs. The idea is to include several different brands under one loyalty program, giving consumers the opportunity to earn points in more places and flexibility to choose rewards that are relevant to them.

More importantly, the coalition approach can provide loyalty program partners with the opportunity to enrich their own customer understanding with new insights from known behaviors outside of their own properties, giving them a more complete view of the customer journey. This collaboration can also address one of the most pressing challenges for brands today by helping to recognize and engage the same customer across multiple touch points. Today, the vast majority of brands cannot consistently recognize the same customers offline and online due to low authenticated login data.

Cooperative identification is a potential approach and logical next step for coalition partners. The increased scale and accuracy of the anonymized loyalty member profiles can enable coalition partners to more effectively target and execute addressable advertising. Consumers also win because those advertisers are delivering more relevant and personalized experiences.

It is essential to use a trusted data and identity network that prioritizes privacy and the seamless flow of data, such as the collaborative identity network powered by Signal. With Signal’s platform, advertisers can securely share their in-market addressable audience segments in an anonymous way to exponentially increase the percent of available and known customers.

The more seamless the customer experience, the more likely they are to continue buying and sharing, and all parties can reap the rewards.

To read more of Signal’s 2016 Digital Marketing Predictions and the action steps you can take toward building an effective collaborative identity network, download the report: “How Digital Marketing Will Change in 2016 – What Marketers Need to Know Now.”

Originally published February 05, 2016

Kathy Menis

Kathy is an expert in technology marketing, with 20 years of experience creating and leading strategic, results-driven marketing programs. She was formerly the CMO at Signal.

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