Top 10 Loyalty & CRM Predictions for 2013

It’s time once again to get in touch with my inner Nate Silver and offer my top 10 predictions for loyalty in 2013. I’m rarely ever right, and frequently completely wrong, so I’ll settle for provocative.

2013 will be the year that:

Mobile Will Continue Its Dominance

OK, so it’s a gimme. I needed to get one right. Lots to sort out to balance opportunity with intrusiveness, for sure, but I won’t go there; I want to remain one for one.

Mobile Payments Are Proven To Work

Whether or not anyone will care is the question. Widespread adoption requires a far better consumer benefit than being able to leave my wallet at home. Specifically: loyalty. But if people (that’s you, media!) continue to refer to the loyalty benefit of mobile payments as coupons, we’re never going to get anywhere. Imagine this: the ability to set preferences on your smartphone that, upon checkout, first pays with stored coupons, then loyalty points, and then from a preferred credit card. Better yet: the ability to monetize and pool currencies from all sorts of programs into a reloadable stored value card. Mad money. It could be the new coalition model. Yeah, I know, what brand would subordinate its program this way? Maybe none, but with U.S. households now belonging to an average of 18 loyalty programs, this approach might be an attractive alternative to the bottom half of them.

Social Media Becomes Truly Trackable

Loyalty programs will increasingly understand and reward real social influence, which is not measured in Likes or retweets, but in activities such as advocacy (through adding original content) and successful referral. Programs could be better and more interesting as a result. As a side effect, loyalty platforms that historically tracked only transactions that can add this capability will regain their edge, and social-only platforms will look one-dimensional.

A Twitter-Like Promotional Marketplace Is Born

An explosion of fun, immediate and effective promotions through social channels (especially Twitter) leads to the creation of a promotional marketplace that functions like Twitter, puts the consumer in complete control and rewards brands who offer the best and most creative promotions. This open marketplace, or exchange, could enhance existing programs or eclipse them. It could leverage the most powerful program currencies and accelerate the rise of super currencies. But it will disrupt the industry.

The Traditional Loyalty Model is Challenged In The Retail Industry

The slugfest will continue, with consumer demand for immediacy, intense competition and technology driving daily deals, coupons and offers that can work within loyalty programs but just as easily replace them. Face it: This approach is immediate and far more generous than any retail loyalty program out there. And as showrooming increasingly gives consumers a slick price and feature comparison capability, immediacy will rule in retail. This will be a disruptive force, and the traditional retail loyalty model will have to change to stay relevant. Bonus prediction: Daily deal sites will struggle, increasingly being replaced by direct, merchant-to-consumer offers.

Loyalty Technology Will Get Cheaper

Cheaper loyalty technology that is still largely full-featured will become available. A new wave of merchants will find loyalty affordable. Agencies offering traditional big loyalty systems will need to figure out a way to offer substantially the same product for 10 times less.

Healthcare Loyalty Gets A New Prescription

The Affordable Care Act (ACA) and general concern about the rising cost of healthcare will usher in a new wave of healthcare loyalty programs. Employers will increasingly impose a surcharge on healthcare premiums that can be waived if employees meet acceptable guidelines for such things as not smoking, body mass index, cholesterol and blood pressure. At the same time, doctors will increasingly be reimbursed by insurance companies for health outcomes, not the number of procedures performed. These developments will result in programs that require consumers to show real results, not just activity, in exchange for significant financial gain—not to mention better health.

Big Data Remails a Concept For All But A Few

The opportunity is real, but the price of Big Data is high. And in a world and industry facing downward price pressure, it’s just not going to happen. Besides, the industry is far from realizing the potential associated with the customer insight it has today, and this will grow significantly richer as social activity tracking goes mainstream.

The Education Market Goes To School In Loyalty

Like housing, the education market bubble could burst. This high cost of college education is unsustainable in its own right, and the emergence of alternative approaches such as free, open online courses through top schools such as Stanford will only magnify this issue. Keeping students in school helps budgets and students. The opportunity for loyalty will go to the head of the class, starting with community colleges.

Gamification Is Relegated to Second-String

It makes sense in theory and won’t go away, but unless it is tied to a broader brand strategy, its role will (and should) be diminished. The popularity of check-ins falls as a result.