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Wed 5 Feb 2020 02:04 PM

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How retail firms can increase loyalty among UAE consumers

One in seven UAE consumers refuse to sign up to retail loyalty schemes because they do not want their data to be tracked - survey

How retail firms can increase loyalty among UAE consumers

The survey found that one in five consumers in the UAE saw personalisation, be it in terms of service, communication, or promotions and offers, as a leading benefit of loyalty programs.

One in seven UAE consumers refuse to sign up to retail loyalty schemes because they do not want their data to be tracked, according to new research from KPMG.

KPMG’s survey showed that product quality is the top factor that inspires loyalty among UAE consumers (77 percent), while value for money, customer service and product consistency all place second at 66 percent.

The report also found that 45 percent of UAE respondents identify points and rewards as an important factor in earning and keeping their loyalty but 14 percent said that they do not belong to loyalty programs because of possible data violations.

Consumers said they similarly feel that signing up and redeeming their rewards is still problematic, while some cited lack of awareness and no interest in loyalty benefits.

KPMG said in a competitive world, acquiring consumers is more expensive than retaining them, and loyal consumers are invaluable as a reliable repeat source of revenue.

Pilar De Miguel Veira, partner and head of Customer Experience at KPMG Lower Gulf, said: “The future of loyalty programs is most likely to depend on an organisation’s understanding of customer needs.

"One of the ways to obtain such an understanding is by data collection as well as the organization’s ability to improve consumers’ experience at every step of the customer lifecycle. Loyalty is not only dependent on perks and discounts but it should grow with each and every interaction.”

The survey found that one in five consumers in the UAE saw personalisation, be it in terms of service, communication, or promotions and offers, as a leading benefit of loyalty programs.

It revealed that material rewards such as cashback and discounts are the most valued features for local customers.

The findings also suggested that 94 percent of UAE consumers would prefer if organisations explored new ways to compensate repeat shoppers.

KPMG said that when revamping existing loyalty schemes, organisations should consider four factors - make loyalty programs easier to use; clarify their purpose; raise awareness and new ways to reward loyalty.

The UAE survey findings echo the global survey, where 74 percent of consumers said product quality inspired loyalty, followed by value for money (66 percent) and customer service (56 percent).

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