The world has entered a moment of profound change. From the black swan event that was the pandemic, to now coping with deep economic uncertainties that include rising interest rates and stubbornly high inflation.
In this era of unpredictability, enabling customer engagement and becoming the brand of choice becomes even more critical for Asia Pacific organisations – not least because tighter household finances mean consumers are now more discerning about where they spend their money. But achieving that engagement with the customer and building life-long loyalty is also more challenging than ever before.
For a start, long-standing behaviours and consumer preferences have shifted in the wake of the pandemic – in some cases, perhaps permanently. Research indicates, for example, that with an increasing array of digital options at their fingertips, customers now have higher expectations of enhanced, highly relevant experiences – and they will quickly look elsewhere if they are dissatisfied.
Overview of report
Collinson recently surveyed 4,750 consumers across the region to understand their evolving expectations and how they would like to be engaged. In this report, we analyse responses from consumers in Australia, China, Hong Kong, India, Japan, Malaysia, Singapore, South Korea, Thailand and Vietnam. Their responses provide insight into how brands can evolve their customer engagement to create genuine customer value balanced with measurable business impact.
Customer experience remains the key to earning long-term, enduring loyalty. Most (76 per cent) of the consumers we surveyed believe the experience a brand provides is as important as its products or services.
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Self-service amendments and cancellations
Online check-in and check-in kiosks, like HomeTag, with which travellers can print their baggage tag at home and bypass the screens when they arrive at the airport
Self-service bag drop kiosks
Automated border and passport control
Digital concierge, mobile check-in and digital keys
Uncovering new opportunities to deepen engagement
Consumer appetite for experiential offerings is rising
While most consumers (60 per cent) cite rational rewards such as points or cashback as preferred ways to engage with them; emotional, ‘experiential’ benefits are becoming increasingly significant.
This is likely because new market entrants are innovating their customer engagement propositions, providing different options and influencing consumers’ expectations for how brands should be engaging with them.
Hyper-personalisation is the future
Brands will continue to succeed by forging deep, one-to-one customer relationships. Most Asia Pacific consumers (74 per cent) now expect brands to personalise their communication and offers to them, reflecting their specific needs.
The airport experience for instance, has evolved to reflect the changing needs of travellers. Working in collaboration with Airport Dimensions (a Collinson brand), Chase launched its new suite of lounges – Chase Sapphire Lounges by The Club – which are designed to reflect a new premium travel concept. Now open at Boston Logan International Airport and Hong Kong International Airport, complimentary access to these lounges is available to its Chase Sapphire Reserve cardholders that are enrolled as members of Priority Pass. Priority Pass members without a Sapphire Reserve card can use their membership entitlements for one visit per calendar year, with additional visits charged at a preferential, discounted rate.
In addition, recognising the growing interest in the gaming culture, Airport Dimensions further pushed the boundaries of what an airport experience can be by launching a video gaming lounge – Game Space – at Dubai International Airport in 2022; further enhancing the experiences of travellers.
Customer Expectations Revealed
The new rules of engagement:
Today, brands are under pressure to deliver measurable business impact through their customer engagement activities.
From Gen Z to Baby Boomers, Collinson – a global leader in customer engagement – has combined direct responses from 4,750 cross-generational, Asia Pacific-based consumers with actionable insights.
If you’re a leading brand looking to engage and retain your most valuable customers, and drive commercial returns, this report is for you.
At the same time, brands are under pressure to deliver measurable business impact through their customer engagement activities. From Collinson’s extensive conversations with organisations across Asia Pacific, we’re seeing this take different forms. Many travel brands, for instance, are seeking to ensure that miles or points accumulated during lockdowns can be used in exchange for other, everyday items. Additionally, an increasing number of brands, particularly in the financial services sector, are creating more contextual engagements by identifying and leveraging micro-moments in their customers’ lives to add value – and in turn, generate a direct and measurable impact to their business.
It’s clear that in today’s more complex business environment, the need for brands to better understand their customers’ expectations is paramount and directly correlates with business success. So, how have these expectations evolved post-pandemic, and what strategies can be deployed to achieve measurable business impact through customer engagement initiatives?
In line with this, there is a major opportunity for brands to bolster an emotional bond with their customer. Moving beyond transactional rewards to create a balance that also enables lifestyle-oriented experiences, is highly valued by customers.
Across the region, research indicates that high levels of pent-up demand bode well for a strong post-pandemic recovery in the leisure and hospitality sectors. Levels of consumer participation in activities such as going on holiday, dining out, attending cultural events, and spending time on fitness and well-being activities are all on the rise, and brands can capitalise on that.
In June 2023, UOB saw a surge in weekly credit (45 per cent) and debit (130 per cent) card applications owing to a pre-sale of Taylor Swift concert tickets exclusively for UOB cardholders. While the demand may not translate into an increase in short-term earnings for UOB, it does give them access to a desirable market segment that can be targeted with a multi-product strategy.
Understanding key shifts in the customer engagement and loyalty landscape
As a first step, we investigated how customer preferences are evolving across Asia Pacific.
When it comes to modes of engagement, agility and ease of use emerge as vital attributes; with 61 per cent of survey respondents advising that they prefer to engage with a brand via a mobile app.
If we break this down by markets, South Korea (73 per cent), Thailand (71 per cent) and India (66 per cent) lead the way, while at the lower end of the spectrum we see China (55 per cent) – likely due to their preference for social media and mini programmes, followed by Australia (54 per cent), and Japan (38 per cent) – the latter being the anomaly, instead favouring website (47 per cent).
Mobile is consumers’ favourite engagement channel
Over half of respondents (51 per cent) say that travel-related experiences must be relevant to them. In mature markets such as Singapore and Australia, consumers have the highest expectations that rewards are relevant and tailored to their needs.
To help overcome engagement challenges in more mature markets, rewards and benefits aimed at enhancing the travel experience are highly regarded, with travellers regarding complimentary airport lounge access as the most desirable travel benefit. Almost a quarter (24 per cent) of respondents rank this first – out of 17 options – in terms of appeal. This was also the top-listed travel benefit for consumers from Japan, Singapore and South Korea.
Across markets, 56 per cent of respondents say that feeling valued as a customer is their top emotion when they have access to a lounge as a reward benefit, while 52 per cent agree that they felt rewarded.
Factor in generational differences in consumer preferences
Differences in behaviour between generational cohorts is important to keep in mind when evolving customer engagement strategies. While travel rewards and benefits resonate strongly with all age groups, younger consumers – and especially millennials – are more influenced by these compared to older generations.
For example, Gen Z consumers (91 per cent) and millennials (72 per cent) are the most likely cohorts to join a new customer engagement programme because it offers the ability to redeem and use travel-related rewards and benefits.
This is likely because these consumers don’t want one-size-fits-all rewards – they want experiences. Millennials (87 per cent) are the most likely demographic to stay with a bank because of the availability of travel-related rewards and benefits; with 80 per cent of this cohort also more likely than other cohorts to use a payment card for everyday expenses, if that card offers them travel rewards and benefits.
This means brands that optimise their customer engagement propositions to accommodate experience-based rewards focused on travel have a real opportunity to connect with this valuable cohort.
However, a nuanced approach is required when it comes to engaging with Asia Pacific’s younger consumers. For example, Gen Z ranks the top three most appealing travel-related benefits as having access to airport transit hotels, airport lounges and gaming lounges. Access to airport transit hotels and gaming lounges are rated higher as compared to other generational cohorts.
In light of this, it’s important to understand how these younger consumers spend. Research indicates that these generations use credit cards slightly lesser than other demographics and favour a more diversified array of payment options such as ‘buy now, pay later’ solutions.
This indicates that if brands are looking to engage and build a following with the younger demographics, and especially Gen Z, they should aim to strike a balance between offering rational rewards (for example, those with tangible financial worth) and building emotional bonds through the status-enhancing, value-adding experiences like airport lounge access that are typically available through credit products.
Elevating every part of the customer journey
For example, we uncovered opportunities for financial services brands to differentiate their customer engagement initiatives by offering travel rewards and benefits that relate to every possible step on a traveller’s journey. That approach takes into account the moment a consumer starts planning a trip, continues on to the range of experiences open to them at the airport, then includes experiences that may occur throughout the rest of their holiday and return journey.
As Collinson’s Rohan Bhalla points out, the return of travel means the opportunity is there to create a more robust and extensive set of cross-border travel rewards to creatively grab consumers’ attention. That might mean having a relevant offer in the destination location that can be pushed to the consumer on arrival. It might also mean tracking and rewarding the consumer’s behaviour as they continue their onward journey.
Meanwhile, travel and hospitality brands such as airlines may wish to consider creating ancillary revenue by selling access to airport lounges, rather than offering this as a status benefit. That sale could take place through the airline’s app and website in much the same way that these brands typically enable passengers to make travel purchases such as hotel and rental car bookings when they book a flight.
Leveraging data-driven insights
However, a common pitfall for brands seeking to ensure that they can deliver measurable business impact via their rewards portfolios is that they do not always align their offered benefits to actual customer behaviours.
Instead, a successful customer engagement proposition should start with clearly defining how customer behaviours correspond to measurable business value.
Velocity: harnessing brand values to drive innovative approaches
As Collinson’s conversations with brands across the region reveal, it is the most creative approaches that are capturing consumers’ attention. Take the ‘Middle Seat Lottery’ campaign, for example – a special raffle with big weekly prizes that Virgin Australia ran through its ‘Velocity’ frequent flyer programme in the first half of 2023.
After research from the airline revealed that less than one per cent of passengers intentionally select the middle seat as their first seat preference, the campaign aimed to reward Australian travellers who chose that option. Lottery entrants were given the opportunity to win from a prize pool worth approximately US$145,000, including a year of platinum status, one million complimentary Velocity points and a six-night Caribbean cruise for two with Virgin Voyages.
Velocity is a programme known for its fun, innovative approach and openness to experimentation – brand attributes it leveraged in this high-profile campaign to make a strong impact with a solid customer experience,” Rohan says.
What’s next?
Three action steps brands can take now
For this report, the data collection agency Cint surveyed 4,750 consumers between 23 January and 8 February 2023 across ten Asia-Pacific markets: Australia, China, Hong Kong, India, Japan, Malaysia, Thailand, Singapore, South Korea and Vietnam. These consumers participate in one or more brand loyalty programmes and took one or more return trips by air in the last year.
About our survey
Learn more about how Collinson is helping the world’s leading brands further leverage the return of travel to design a strong travel-experience customer engagement proposition, enabling them to better engage and build stronger relationships with their most valued customers and in turn, drive positive commercial returns.
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As our survey results and wider conversations with brands reveal, Asia Pacific organisations have good reason to be optimistic about driving customer engagement, even in today’s more challenging business environment.
For a start, the return of travel gives brands a timely opportunity to innovate and enhance customer experiences. By acting on their ability to add value to people’s lives through travel-related experiences, brands can be better positioned to build emotional connection.
74% of customers also believe brand collaborations create greater value and even will encourage them to stay loyal to their main brands’ customer engagement programmes.
For more than half (55 per cent), a personalised offer is the main reason consumers want to be contacted by a brand in the first place.
However, as Rohan Bhalla, Vice President of Business Solutions, Asia Pacific at Collinson, points out, personalisation is not an end-goal, rather a process of continuous learning, innovation and tests that enable brands to be effective communicators, just as we humans do in our day-to-day interactions with each other.
For instance, leveraging advanced technologies such as machine learning and AI for a more hyper-personalised, ‘in the moment’ approach that can truly speak to individual preferences; not just those of a customer segment. If done thoughtfully and executed at scale, there is a significant financial upside to be unlocked for brands through personalisation. A past BCG analysis has shown that by redirecting 25 per cent of mass promotion spending to personalised offers, businesses can see an increased return on investment by 200 per cent.
Experience a brand provides is as important to products / services
Brand collaborations provide greater value, thus encouraging loyalty
76
%
74
%
Financial services brands may have an advantage in providing these kinds of experiences. They are more experienced when it comes to working with partners and merchants to curate unique offers and experiences for their customers that encourage spend and usage. Further, they can connect customer data across products to identify and predict major life events; from celebrating milestones such as birthdays, to saving for university and planning retirement. Leveraging this data thoughtfully and effectively can enable them to target and convert customers when they’re most likely to buy, while deepening perceptions of their brand as a trusted partner and ‘lifestyle enabler.
By adopting such a customer-centric approach, brands have an opportunity to foster engagement that adds value to their customers’ lives, while creating commercial impact.
Expect to receive personalised communication and offers
74
%
Customers in Asia Pacific
Have an emotional connection to the brands they buy from most
68
%
Expect a brand to anticipate their needs
67
%
Digital rewards, in the form of NFTs and experiences in the metaverse
19%
Consumers in Asia Pacific are seeking the following rewards:
Airport lounge access
41%
use the arrows to learn more
Consumers in Asia Pacific are seeking the following rewards:
Environment sustainability rewards
Consumers in Asia Pacific are seeking the following rewards:
26%
Charitable donations
Consumers in Asia Pacific are seeking the following rewards:
18%
Experiences can also be delivered through digital means, with innovative rewards in the form of non-fungible tokens (NFTs) – unique digital assets that cannot be replicated or replaced, and typically a piece of artwork – recently rising in popularity, in line with the wider consumer interest in NFTs. Such rewards are highly valued by almost one in five respondents (19 per cent). Customer engagement programmes can leverage the appeal of NFTs by offering them to members as limited-edition rewards. As these digital artworks cannot be obtained elsewhere, they can be effective in creating a sense of exclusivity and prestige.
Additionally, over a quarter (26 per cent) of surveyed consumers say ‘ethical’ rewards – such as options to support sustainability and reduce carbon emissions – are key to customer engagement programme satisfaction. An example might involve giving members an option to donate air miles to green causes, effectively offsetting their carbon footprint.
We found such rewards are most popular with younger consumers such as millennials and Gen Z, who often actively seek out brands and businesses that demonstrate a commitment to social and environmental issues. Programmes that incorporate such rewards can send a strong signal that a brand is dedicated to making a positive impact in a way that resonates with the values of these younger generations.
Experience rewards such as VIP privileges
Consumers in Asia Pacific are seeking the following rewards:
39%
Unsurprisingly, this channel is most popular with Asia Pacific’s technology-savvy millennials and Gen Zers, who typically bring a digital-native mindset to their engagement with brands.
Fewer than half of respondents (46 per cent) said they favour brands’ websites when it comes to engaging with a programme, and only a third (40 per cent) favour social media; while phone (31 per cent) and mail (13 per cent) came in as the least favoured way to engage.
South Korea
Mobile app is the most preferred engagement channel in Asia Pacific
If there is one experience that Asia Pacific consumers especially value now, it is travel. Studies indicate that after years of waiting for the pandemic to recede and borders to open, consumers across the region are eagerly embracing the opportunity to head back out to explore the world. With the travel industry bouncing back, brands have new opportunities to innovate and enhance customer experiences in line with this trend.
Our survey results reflect this – with there being an enormous appetite for customer engagement rewards and benefits that can expedite travel and enable positive travel experiences. In fact, there is mass consensus (93 per cent) among respondents that the availability of such rewards is what encourages them to engage regularly with a brand.
This is particularly the case in Asia Pacific markets with significant untapped growth potential where customer engagement initiatives are concerned. In Vietnam for instance, 97 per cent of consumers agree that travel-related rewards would encourage them to join a brand’s customer engagement and loyalty programme. In both Thailand and Malaysia, that figure is 94 per cent, and in India, 90 per cent.
Our findings also indicate that across the region, travel rewards and benefits are strongly impacting both brand choice and spending intent. Almost half (46 per cent) of respondents say that brands that offer such rewards are highly effective when it comes to influencing their spending behaviour.
When it comes to programmes offered by financial services brands specifically, this appetite for engagement through travel experiences is just as marked. Seventy-six per cent of surveyed consumers say that they chose to go with a bank because of the travel rewards they offer.
Travel represents a major opportunity
"Travel rewards have the power to impact across the entire customer journey from acquisition to engagement and even retention. The high perceived value associated with travel related rewards and benefits makes them a key strategic, value proposition to influence customer behaviour and drive long-term loyalty. By drawing on a deep understanding of their customers and key touchpoints along the buying journey, brands can tailor their communications, offers and rewards to ensure these are relevant. That way, they will be better able to build engagement and loyalty over time,” says Rohan.
But what kind of travel-related rewards and benefits matter most to Asia Pacific consumers right now, and how should brands be redefining their offerings to help them bring about positive business outcomes?
Delivering compelling travel-related experiences that add value
Top 3 most appealing travel-related benefits for:
Gen Z
Access to Airport Transit Hotels
Airport Lounge Access
Access to Gaming Lounges
24%
17%
12%
Millennials
Airport Lounge Access
Access to Airport Transit Hotels
Access to Gaming Lounges
25%
21%
9%
Gen X
Airport Lounge Access
Access to Airport Transit Hotels
Discounted / Complimentary F&B Inside Airport
28%
17%
8%
Boomer
Airport Lounge Access
Access to Airport Transit Hotels
Airport Parking
23%
16%
10%
Gen Z consumers (91%) and millennials (72%) are the most likely to join a new customer engagement programme because it offers the ability to redeem and use travel-related rewards and benefits.
In our previous section, we revealed insights into what consumers now value most when it comes to travel rewards and benefits. But what does all this look like in practice?
Collinson’s deep engagement with organisations across the region sheds light on how leading brands are designing their customer engagement propositions to win in today’s more challenging environment. That includes exploring new ways to help ensure that the rewards and benefits they offer are commercially viable.
How leading brands are optimising benefits portfolios
The appeal of airport lounge access also strongly correlates with age and income. For financial services’ consumers, for example, we found that older and more affluent consumers are more likely to rank this benefit as most appealing – and are willing to pay more for it. 74 per cent of Gen X consumers, for example, expect to be offered airport lounge access as a reward on a premium payment card.
Access to airport transit hotels placed second overall, while Gen Z and millennial consumers revealed access to gaming lounges to be their third most appealing travel-related reward.
“Let’s say a financial services brand wants to engage with its standard cardholders via an incentive programme. In exchange for certain behaviours, they are offered a high-value benefit such as lounge access – typically something that the brand only makes available to premium card holders. But to ensure success, the brand needs to be able to track and measure whether the standard card holders would actually value such a benefit in the first place.
The ability to draw on data-driven insights is vital to winning with this kind of strategic approach. With the right technology solutions in place, brands can communicate relevant offers at the right time, creating a seamless experience that bolsters engagement,” says Rohan.
STEP
Clearly define the brand, financial and customer objectives you want your programme to support, and how customer engagement initiatives can play a part in each.
1
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Key Learnings:
Craft a strategy that articulates the customer segments to prioritise, the types of benefits to offer and the appropriate channels for delivery, so that your organisation can meet those objectives.
Implement the marketing technology infrastructure that can help you access the data-driven insights you need to ensure the rewards and benefits you create truly align with customer preferences.
The following three steps will help set brands on the right path to redesigning their customer engagement proposition, and enable them to make the most of this compelling opportunity:
All three measures are needed to enable brands to unlock the deeper consumer insights they need to better communicate with customers as unique individuals.
That way, brands can drive deeper and more effective customer engagement, while also achieving positive business outcomes.
STEP
2
STEP
3
Valued as a customer
56
%
Rewarded
52
%
Loyal to the brand
44
%
In Asia Pacific, airport lounge access makes travellers feel:
By adopting such a customer-centric approach, brands have an opportunity to foster engagement that adds value to their customers’ lives, while creating commercial impact.
Key Learnings:
Key Learnings:
Thailand
India
Singapore
Malaysia
Vietnam
Hong Kong
China
Australia
Japan
73%
71%
66%
65%
65%
62%
62%
55%
54%
38%
In today’s more complex business environment, the need for brands to better understand their customers’ expectations is paramount and directly correlates with business success.
Moving beyond transactional rewards to create a balance that also enables lifestyle-oriented experiences, is highly valued by customers.
Financial services brands may have an advantage in providing these kinds of experiences. They are more experienced when it comes to working with partners and merchants to curate unique offers and experiences for their customers that encourage spend and usage.
Further, they can connect customer data across products to identify and predict major life events; from celebrating milestones such as birthdays, to saving for university and planning retirement.
Differences in behaviour between generational cohorts are important to keep in mind when evolving customer engagement strategies.
A common pitfall for brands seeking to ensure that they can deliver measurable business impact via their rewards portfolios is that they do not always align their offered benefits to actual customer behaviours.
While travel rewards and benefits resonate strongly with all age groups, younger consumers – and especially millennials – are more influenced by these compared to older generations.
For example, Gen Z consumers (91 per cent) and millennials (72 per cent) are the most likely cohorts to join a new customer engagement programme because it offers the ability to redeem and use travel-related rewards and benefits.
The ability to draw on data-driven insights is vital. With the right technology solutions in place, brands can communicate applicable offers at the right time, creating a seamless experience that bolsters engagement.
That might mean having a relevant offer in the destination location that can be pushed to the consumer on arrival. It might also mean tracking and rewarding the consumer’s behaviour as they continue their onward journey.
Leveraging data thoughtfully and effectively can enable brands to target and convert customers when they’re most likely to buy, while deepening perceptions of their brand as a trusted partner and ‘lifestyle enabler’.
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