In the face of rising interest rates and household costs, consumers across many industries are turning to money saving methods, and the liquor and hospitality industries are no exception.

Australians across the country are utilising consumer loyalty programs as a means of curbing spending and increasing value, making them an important tool in the management of household budgeting and discretionary spending.

According to data gathered by Circana, 27 per cent of Australians ranked loyalty-card rewards as an extremely important factor when determining where to shop. While consumers opt for home consumption as a cheaper alternative to on-premise experiences, retailers should consider how they can offer value to consumers through loyalty-based schemes.

In speaking with National Liquor News for the 2024 Industry Leaders Forum, Michael Courtney, Chief Executive at Coles Liquor, said that while customers seek value in at-home consumption moments there is great significance in loyalty-based programs.

“As customers experienced mounting cost-of-living pressures, it became increasingly important for us to provide choice within value and value beyond price. That’s meant we’ve really had to understand exactly what our customers are looking for and provide an offer that meets their specific needs.

“Our loyalty programs Flybuys and VC Club played an even more important role this year and will continue to do so into 2024 when the offering will become more sophisticated and personalised.”

And beyond the rewards offered to the shopper, John Barakat, Acting CEO at Australian Liquor Marketers (ALM), explained how loyalty programs and digital strategies can enhance the shopper experience.

“We know cost of living pressures are not going away in 2024 and creating value for shoppers is hugely important both through price and incremental value, like delivery and loyalty.”

Speaking about ALM’s new Network of the Future strategy, he said: “A key area of focus is loyalty, which will enable customer personalisation, recommendations, and insights, and we know personalisation will only become more important in coming years.

“Customers are more willing to share their data with a retailer if it results in discounts on their purchases or a better understanding of them as a shopper.”

With increased usage of shopper loyalty programs, the opportunity to capture first-party data in return for promotional pricing creates significant opportunity for retailers to drive sales through targeted and personalised data and promotions.

In Circana’s 2023: FMCG Outlook Part 4: The Future of Retail report, the consumer behaviour advisor stated: “Loyalty apps and cards drive strong engagement and create a platform for more efficient targeting. And those that have hugely improved front-end customer experience are winning with real-time push notifications and loyalty integration.”

Echoing this sentiment, Gavin Saunders, CEO of Liquor Marketing Group (LMG), spoke about the importance of using that data correctly to drive sales.

“Loyalty presents a great opportunity to further enhance a retailers offer to the shopper. Greater knowledge of the shopper allows for more tailored promotions and drives higher conversion. While loyalty is complimentary to the retail offer, the fundamentals of pricing, service and experience need to be maintained.

“LMG has seen the power and insights of first party data through the Zen acquisition and trial, but collection of transaction data is just one component. Equally important is ensuring that the engagement enabled enhances your brand’s offer. This is why LMG is investing in upgraded Martech to complement the wider scale loyalty launch in 2024.”

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