Article

The Future of Loyalty Lies in Artificial Intelligence (AI)

Par 8 July 2021 May 7th, 2024 Aucuns Commentaires
Un utilisateur discute avec l’intelligence artificielle (IA) de l’application mobile d’un programme de fidélisation

Many companies are already using artificial intelligence (AI) to improve the performance of their loyalty programs. Let’s take a look at how AI is shaping the future of loyalty.

Before getting into the subject, let’s untangle two important notions. There’s a lot of confusion between artificial intelligence (AI) and machine learning (ML). Machine learning is a subset of AI. It involves creating algorithms capable of recognizing patterns in large, evolving data sets, and drawing conclusions from past experience using this data.

Bande dessinée sur l'utilisation des cookies par le MarketoonistCustomer data drives loyalty. Integrating AI enables program managers to make better use of this data. In fact, every interaction, comment or transaction that customers make generates data about them. This data allows us to better understand how :

  • create engagement
  • improve retention
  • develop more accurate profiles
  • produce more relevant and personalized content
  • generate more efficient offers

Artificial intelligence applications examples

The most common use of AI is the integration of chatbots. Customers increasingly prefer to use online chat services rather than call customer service. This is because online chat services are proving to be more convenient, quicker and more efficient.

AI tools can also be used to better understand the consumer decision journey in order to optimize the user experience. For example, companies such as HSBC and Mastercard use AI to predict the best type of reward to offer cardholders.

Another example is Walgreens1 :

Machine learning and testing mean that AI can constantly refine its customer profiles for greater levels of personalization based on what customers respond to. “We have a continuous culture of improvement,” Lisa Zhao, senior manager, supplier direct marketing, said. “Scale and improve through a test-and-learn approach — channels, offer types, creative, format/vehicles, etc. Identify what works, what doesn’t. This influences future campaigns.” Overall, AI enables brands to create better customer experiences with a customized and targeted loyalty program.

Closer to home, the SAQ2 is one of the companies using artificial intelligence for its loyalty program. Their SAQ Inspire program is one of the best in Canada, according to our LoyalT study. Its level of personalization is highly advanced. In fact, it’s one of the most advanced in the world. Every week, the program produces over 1.3 million personalized newsletters for its members. Achieving this level of hyper-personalization would be impossible with manual labor.

Bar chart displaying the preferences of Canadians for personalized offers related to loyalty programs, highlighting the impact of artificial intelligence in customization

In the 2020 LoyalT study, many Canadians expressed an interest in receiving personalized offers.

Cutting-edge, sought-after expertise

While the promise of artificial intelligence is enticing, your business and your program need to be ready.

The loyalty business requires a wide range of expertise, which is becoming increasingly rare. Experts in analytics, information technology (IT) and data scientists are in demand. Employers are already in constant competition for these skills.

The workplace is changing fast. This change is causing many companies to rethink their hiring and talent management strategies. The best companies know that talent is now the scarcest resource.

What talents or expertise do you need or will you need in 12 months’ time? How will you attract and retain candidates?

The Agile methodology

If the future of customer loyalty depends on artificial intelligence, success depends on agility. Agility has become one of the keys to business success.

The most successful organizations adopt a flattened organizational structure and develop ad hoc multidisciplinary project teams. This enables them to develop, test and implement new strategies rapidly and agilely.

Innovations and new technologies, including artificial intelligence, are set to develop at a breathtaking pace. Is your organization ready to make these a priority? Is it structured for efficiency and rapid decision-making? Your AI investment will be in vain if your organizational structure operates in silos.

Is your program ready to take the next step? Let’s take a look at how to optimize it.

 


1 Customer Insight Group, Customer Loyalty Trend: Artificial Intelligence, December 2018
2 The Société des alcools du Québec (SAQ) is a government corporation whose mandate is to sell alcoholic beverages.

 

Hans Laroche

Hans Laroche

With over 35 years of experience in relationship marketing, loyalty program management, and development, Hans Laroche contributes to the relationship strategies of numerous companies, including Nespresso, The Royal Canadian Mint, Fido, belairdirect, Cirque du Soleil, Énergir, McKesson, and Desjardins. He has also been sharing his passion with master's students at ESG UQAM and the University of Sherbrooke for 30 years.

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