India Loyalty Programs Industry Outlook in 2023

India Loyalty Programs Industry Outlook in 2023

India Loyalty Programs Industry Outlook in 2023

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With rising inflation and declining consumer spending, more and more firms are introducing a new loyalty program or examining how they can add more value to their customers through the existing one. Indian consumers are known to shop from brands that reward their shopping. Consequently, amid the growing influx of new and revamped loyalty programs launched by retailers and new-age internet-based businesses, the loyalty and rewards program industry in India is projected to record strong growth over the next three to four years.

New-age internet-based businesses are launching loyalty programs to attract users in India

With the growing digitalization in the country, millions of Indians have gained access to internet services over the last three to four years. This has resulted in huge growth potential for new-age internet-based businesses. To capitalize on the Indian market, both global and domestic firms are launching new loyalty programs. For instance,

  • In December 2022, Adani Group, one of the leading conglomerates in India, announced the launch of its new business entity, Adani One. The internet-based platform allows consumers to book flights and cabs, among other things. Along with the launch of Adani One, the firm also launched a loyalty program that allows users to earn and redeem points for making purchases on the platform. The loyalty program is similar to that of Tata Neu, which also allows consumers to earn and redeem points for shopping, bookings, and more.
  • In December 2022, Spotify, one of the leading global businesses in the entertainment category, announced the launch of its in-app rewards program for listeners in the country. The rewards program aims to drive traffic to its platform and boost the popularity of its Premium Mini subscription program in India. The pilot program will offer discounts and other benefits, which will be based on the platform usage by the listener.

From the short to medium-term perspective, PayNXT360 expects more new loyalty program launches by internet-based businesses in India, as they seek to capitalize on the growing digitalization taking place in the country.

Food delivery businesses are launching loyalty programs as they compete for market share in India

The competitive landscape in the Indian food delivery market has grown significantly. Amid the growing competition, firms are resorting to loyalty and reward programs to drive traffic and incremental revenue.

  • Jubilant FoodWorks, the firm that runs the Domino’s franchise in India, launched a new loyalty program in July 2022. The loyalty program is part of the firm’s strategy to drive away some of its business from food aggregator platforms, such as Zomato and Swiggy. Under the program, the firm announced free pizza for points that they earn from ordering on the online platform.
  • In November 2022, Zomato also announced that the firm is working on a differentiated loyalty program after it discontinued its membership programs earlier in 2022. The firm’s competitor, Swiggy also has a membership program for its food delivery and grocery service.

With an increasing number of consumers ordering food online in India, PayNXT360 expects these loyalty programs to gain widespread traction from the short to medium-term perspective, thereby supporting the growth of the industry over the next three to four years.

Retailers are launching revamped loyalty programs with more benefits for their members in India

In times of the current macroeconomic environment, retailers are seeking ways to drive sales and incremental revenue. This has led to many revamping their loyalty programs that offer more value to their members.

  • In November 2022, Marks & Spencer, one of the leading global retailers, announced that the firm is revamping its loyalty program, Sparks, in India and the global markets. The loyalty program is customized to better cater to the demand of Indian shoppers in the fashion industry. From savings to sustainability benefits and services, the firm is targeting higher growth revenue from the short to medium-term perspective in India.

Along with India, the firm is launching the loyalty and rewards program in 25 more markets around the world, including the United States. Over the next three to four years, PayNXT360 expects more retailers in the fashion industry to revamp their existing loyalty programs, to include more personalization based on the needs of Indian customers.

To know more and gain a deeper understanding of the loyalty program market in India, click here.

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