Tech trends that will impact loyalty in 2018

As you’re settling into 2018, it’s a good time to review your plans for the year ahead – and prepare your marketing, loyalty and CX strategies for the changes that are coming. As always, developments in technology will have a key role to play in shaping marketers’ approach to loyalty and customer experience this year.

To help you stay ahead, we’ve highlighted four key tech trends that will impact loyalty and customer experience in 2018.

Augmented reality has captured consumer interest

Other than the brief Pokemon Go craze in 2016, augmented reality hasn’t spent much time in the spotlight – yet. But with consumer-favourite retailers like Sephora and Ikea rolling out AR tech both in-store and at home, virtual reality’s more practical cousin is headed for the mainstream.

The primary application at the moment involves enabling customers to virtually try out products in context. For Sephora, this means allowing shoppers to preview different shades of lipstick and eye shadow through a mobile app which overlays products onto a customer’s face in real-time. Similarly, Ikea, in partnership with Apple, is using AR to help customers visualise products in their own homes through an iOS app.

And consumers are interested in seeing more applications of this technology. In a survey conducted in 2017, 61% of consumers said AR is the tech they’re most keen to try out. Additionally, 50% of consumers said they’d be more loyal to a brand that offered AR experiences to help them visualise its products – this rises to 69% among 18 to 24-year-olds.

The key to success is ensuring that this tech is used to create value, not just dazzle the consumer. The latter may generate hype at first, but it won’t cause customers to stick around long-term.

Blockchain will take loyalty programs into the future

Blockchain is the fad of the moment, with companies across industries announcing their own initiatives – and watching their stocks jump as a result. While blockchain’s ability to truly catch on across all these varied sectors may be uncertain, it’s definitely got practical applications in the loyalty industry.

Not only does a blockchain approach to loyalty have the potential to simplify life for marketing teams and program managers, it also promises to improve the end customer’s experience.

Primarily, blockchain would allow loyalty programs to be more connected, with multiple parties able to share data in real (or near-real) time. That will enable businesses to access more up-to-date data about their customers’ interactions and develop more rewarding partnerships with other brands – creating a personalised and frictionless experience for customers. Additionally, details of each and every transaction are recorded and tracked, offering extra security against fraud.

NFC, QR and beacons are making a comeback

NFC (near-field communication), QR codes and beacons have been around for years as a way to link up digital devices with the physical world. Yet they’ve not really taken off in the way they were envisioned.

One of the biggest barriers to adoption - especially for the much-maligned QR code – was the need for additional tools to enable the transfer of data. A scanning app was required for the QR code, while beacons relied on Bluetooth and an app. NFC merely had to be enabled, but this was only possible on Android devices. It all made for a less-than-ideal experience for the user.

And yet, 2018 could be the year for these bits of proximity tech, thanks primarily to the latest iOS updates. iPhones (from 7 and up) now have a dedicated QR scanner built into the camera, plus NFC enabled for more than just Apple Pay (though you’ll still need an app). We’ve yet to see any widespread use cases outside payment tech, but removing these barriers opens up a lot more opportunities.

This is particularly true in the retail space, where beacons, NFC and other connected devices are key to creating a truly joined-up experience across online and offline channels. Employed well, proximity tech like this can create emotional connections along the course of the customer journey, by making shoppers feel valued and cared for at key moments.

Keep an eye on all this in-store proximity tech over the next few months, as we expect to see more practical applications popping up soon.

“Smart” devices are filling homes and offices

The battle of the smart speakers really kicked off in 2017, with Google Home and Amazon Alexa seeing significant updates, and Apple’s HomePod finally joining the fray. Recent research found that the consumer adoption rate of smart speakers has outpaced the initial adoption rate of smart phones back in the day.

Of course, these voice-activated assistants aren’t the only “intelligent” devices finding a place in our daily lives. Security systems, thermostats, kitchen appliances, and even light bulbs are all getting a WiFi connection, allowing them to join up with other devices.

The question for 2018 is this: How will marketers make use of the additional data and touchpoints that come with wider adoption of IoT devices – and do so in a way that improves, rather than damages, customer relationships?

IoT devices offer an excellent opportunity to build loyalty by engaging customers in a timely, personalised way – but they present a lot of potential pitfalls as well. For marketers looking to explore this tech in 2018, the key is to keep the focus on adding value and improving CX, rather than using this as another advertising channel.

In fact, that statement holds true for all of the tech on this list. For long-term success (and profitable relationships), it’s essential that brands use technology to benefit their customers first – to improve interactions and serve them better, while respecting their time and privacy. Anything else is a recipe for a disengaged and disloyal audience.