Everybody loves free stuff. It’s human nature. Although rewards programs were once highly prized and true differentiators among financial services providers, it appears that typical rewards programs have grown stale. Traditional rewards are in a poor position to shape customer loyalty and influence spending going forward.
Merchants have already been catering to evolving consumer expectations, and banks and card issuers need to do the same. Understanding consumer behavior will be critical for banks going forward if they wish to redesign effective rewards programs that actually acquire and retain customers. Among other actions, banks need to invest in advanced analytics and do away with cumbersome redemption processes that now ignore mobile-led consumer behaviors.
PwC's Dean Nicolacakis discusses the evolution of rewards programs and explores new ways to build customer loyalty.
“A vast majority of card rewards programs today are not aligned with consumer spending habits, and an overhaul of these programs to match real-time consumer engagement should be pursued.”
PwC offers a seamless end-to-end services portfolio to help financial incumbents to leverage FinTech trends and convert threats into opportunities: