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With Australian consumers already feeling the pinch in the face of a looming recession, the pivotal first Labour Federal Budget put easing the cost of living firmly at its core.
The latest data from the Australian Bureau of Statistics (ABS) shows the Consumer Price Index (CPI) rose 6.1 per cent in the 12 months to June 22 and 1.8 per cent in the most recent quarter.
To mitigate the risks of inflation and better protect their finances, consumers and businesses alike continue to look for ways that they can help keep costs low. Most businesses have turned to technology solutions to help streamline operations and eliminate costly processes where possible. While this doesn’t sound like it immediately impacts the consumer, there are ways that retailers can leverage smart technology platforms to reduce costs for themselves and their customers. For example, digital loyalty and rewards programs could be used to help many Australians find more cost savings at the cash register.
Over time, customer loyalty and rewards programs have moved beyond being mere avenues to help foster brand loyalty with purchase incentives. Now, they can benefit the consumer in the form of significant savings and actual financial outcomes, such as cashback rewards.
Some savvy shoppers will already be aware of how using a loyalty and rewards program can help them save; however, many others will be unaware of how they can use such programs to make a real impact on their cost-saving efforts, especially in a time of continued economic uncertainty. While the cost of living continues to rise, and wage growth fails to meet the levels that would provide customers some relief, loyalty and rewards programs have emerged as a silver bullet to support customers.
A reported 90 per cent of Australian consumers have seen increases in household bills and expenses in the past year. While consumers can penny-pinch to keep costs low to a degree, more needs to be done to help mitigate the longer-term impacts of financial strain, with many Australians looking to businesses and government to provide additional support. In particular, the recent Jobs Summit has constituents reflecting on the Accord agreements from the Keating government as a guide for how to navigate the continued economic challenge.
While the government continues to grapple with the best course of action to help align real wages with the perceived social wage, more can be done to alleviate pressure on consumers where it matters most: the point of sale.
There’s a misconception in the market around the true value of loyalty and rewards programs for consumers; however, rewards programs can ultimately help to create essential savings for consumers where it can have the most impact on their expenses. Beyond being an avenue for businesses to foster brand loyalty and promote hyper-personalised marketing opportunities, digital loyalty and rewards programs can help customers save significant amounts with the support of savvy retailers.
Digital loyalty and rewards programs that offer discounts and cash back to customers can empower customers to keep their spending low when it matters most. With the support of tailor-made promotions and offers for customers, guided by customer data on spending habits and behaviours, retailers can deliver cost savings that make a real impact on consumers. While this encourages customer loyalty on one-hand, it also delivers long-term economic impacts by helping both customers and retailers continue to spend and save even in challenging economic environments.
Anurag Vasisth is CEO of Loyalty Now.
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