Across Australia and New Zealand, rising living costs are directly impacting consumers and their discretionary spending. In the current economic climate, retailers are feeling the pinch as consumers look to decrease spending and increase value.
Nationally, there has been an increased uptake in the use of consumer loyalty programs to make spending go further, a trend that, when used correctly, can help convenience retailers to increase footfall. One such retailer is 7-Eleven Australia, which is in the process of evolving its digital solutions to provide customers with convenient shopping and loyalty options through its partnership with Grabango.
Through this partnership, 7-Eleven is developing its My 7-Eleven App Pay and Go 2.0 which is expected to launch in 10 stores by the end of 2024. The Grabango technology uses AI to enable customers the choice to skip the register, without the need to even scan purchases using their device.
Over in New Zealand many users of Z App – an app for Z Energy customers – the big draw is another essential daily fuel: coffee. Z App’s ‘jump the queue’ feature is one of Z’s most popular mobile offerings, allowing customers to pre-order custom-made drinks from Z stations nationwide.
It might not be the flashiest digital feature, but it’s a favourite of Z’s GM Strategy, Delivery and Innovation, Mandy Simpson.
“If I’m heading out for the day, I’ll often order a coffee to pick up at my local Z on my way out,” she says. “And when my partner and I are on a long drive, whoever isn’t driving will order the coffees for the next stop.”
Almost one in four coffees sold by Z are now pre-ordered online, a stat that’s mirrored in the skyrocketing usage rates for Z App as a whole. Its active userbase grew by 78 per cent in 2023, with monthly transactions now three times what they were in 2021 when Z began focusing on app adoption.
Z App is a key part of Z’s digital strategy but, more than that, it epitomises the innovative, customer-first ethos that has long been central to the Z brand.
For many customers, digital equals timesaving, whether that means pre-ordering coffee or being able to purchase petrol without getting your wallet out. With your payment details securely stored, the Pay with Z App feature offers a seamless payment process.
Using the Pay by Plate option is even easier, as a customer’s pump is recognised by forecourt cameras and all they need to do is unlock it on their phone. Payment is charged to the customer’s card automatically once set up – no swiping or queuing required.
Despite its digital success so far, Z isn’t standing still. Coming up in April it will integrate its EV Charging App into the main Z App, meaning drivers of electric vehicles will no longer need separate apps to charge their car and pre-order coffee for the road.
“The world is changing – energy use, in particular, is changing so fast. We’re focused on readying ourselves to meet that need from our customers. This is definitely not the end of our innovation journey,” says Simpson.
While loyalty programs are instrumental in building brand loyalty and getting customers through the door, they are also a great tool for collecting first-party data, which can be used to enhance customer experiences and deliver personalised promotions.
Anurag Vasisth, Co-Chair and Group CEO, Loyalty Now, said that businesses must acknowledge the heightened competition for consumer spending.
“In such a competitive environment, personalised, secure loyalty programs that offer real financial benefits, and peace of mind, can be a differentiator. They provide an incentive for customers to stay loyal to a brand, even in tough economic times. The key lies in designing these programs to be flexible, adaptive, and closely aligned with consumers’ evolving financial constraints and shopping patterns.
“Being able to tailor experiences, discounts, and offers based on individual customer behaviours, trends, and other key insights is paramount to better connect consumers with brands where it matters most: the point of sale (offline or online). Feeling understood and valued through personalised interactions enhances customers’ shopping experience and solidifies their loyalty to the brand. This is especially important when a customer is handing over their hard-earned money for goods and services.”
The power of personalisation in loyalty programs extends beyond simple transactional benefits and empowers businesses to create a narrative and emotional connection with their customers. Personalised communication, offers, and rewards that resonate with the individual’s lifestyle and preferences transform loyalty programs from mere transactional tools to integral elements of the customer’s everyday life.
Each interaction and transaction provides valuable information about customer interests, buying patterns, and potential future needs. These insights are critical to inform the loyalty program itself, and it can also help shape broader business strategies, including product development, marketing, and customer service enhancements.
However, not every digital loyalty platform is created equal and it’s critical for businesses to deploy platforms that balance customer experiences, business success, and robust security in equal measure. This requires a dual approach: on one hand, there is a need for secure, enterprise-grade technology capable of handling complex data analytics and customer segmentation without compromising data security; on the other hand, technology must seamlessly integrate with user-friendly customer interfaces. Balancing these two aspects ensures that, while the systems behind the program are sophisticated and data-driven, the customer experience remains intuitive and engaging.
Vasisth highlighted that traditional models of brand loyalty relied on emotional connection and brand reputation. However, in the new economic reality, loyalty programs require a strategic reorientation to align with the evolving financial priorities of consumers.
“Brands can use personalised loyalty programs that are tailored to individual shopping habits and preferences to deliver targeted value through rewards, and benefits that resonate with value-conscious customers. This level of personalisation adds value to the customer’s shopping experience and positions the brand as empathetic and responsive to their needs. Through this, businesses can maintain a strong connection with their customers, encouraging ongoing engagement and sustaining sales, even amidst a cost-of-living crisis.”
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