This case study highlights how we leveraged retail data analytics and industry expertise to co-create a sustainable customer loyalty program for a leading travel retailer.
As we know…
While traditional brick-and-mortar businesses have given way to e-commerce over the years, duty-free retail has continued to thrive despite the largely offline model.
However, the unique nature of the duty-free retail business means the opportunities for driving active customer engagement and repeat sales entirely depend on the customer’s decision to travel. Thus, a robust retail customer engagement strategy becomes vital for enterprises to build sustainable loyalty.
The challenge for our client, a travel retailer operating duty-free stores, was…
While attracting new members, its tiered, discount-based loyalty program could not drive meaningful customer engagement beyond the first purchase. 90 percent of members purchased only once a year, significantly reducing the potential for brand recall during and after travel.
Moreover, the discount-based model (focused on upfront incentives) eroded margins, with no increase in repeat purchases or soft engagement with members.
Stepping in as a co-creation partner…
Triange Consult, the consulting arm of WNS Triange (our data, analytics and AI practice), implemented a holistic analytics-led solution. Our consultants deployed loyalty assessment frameworks to assess the client’s existing loyalty program, perform a comprehensive health check, including behavioral analytics, and re-design the loyalty program.
The first phase of the engagement involved WNS Triange leveraging a proprietary framework and extensive data analysis to evaluate the overall health of the existing loyalty program. The team used inferential data analytics and advanced statistical techniques to estimate performance on several metrics, including:
- Customer attrition
- Optimal time-to-market
- Member segmentation
- Behavioral analysis of members versus non-members
During the second phase, WNS Triange designed a cashback-based loyalty program. This included developing the loyalty program’s financial model as well as the operating model and the strategy for driving member engagement and monetization opportunities when members were not traveling. While we carefully considered other loyalty constructs, we found the cashback model, driven by an ecosystem of industry-wide and cross-industry partnerships, to be the most effective alternative for the client.
This collaborative engagement led to the client…
Discovering untapped revenue potential to the tune of USD 300 Million. This translated to more than 75 percent revenue growth over the existing program.
The design of the new retail loyalty program enabled the client to:
- Incentivize members to engage during periods when they were not traveling
- Gain a holistic view of members’ demographic and psychographic profiles from their transactions with the partner network
- Leverage a framework of reference on customer behavior to better plan and design campaigns, drive active engagement and monetize the program
- Impact (positively and measurably) a wide range of revenue, cost and customer experience metrics, including:
- Revenue per member and revenue per transaction
- Cost per campaign through campaign optimization and automation, people cost rationalization and incentive cost optimization
- Member satisfaction scores
About WNS Triange:
WNS Triange (formerly WNS Research and Analytics practice) powers business growth and innovation for 120+ global companies with data, analytics and Artificial Intelligence (AI). Driven by a specialized team of over 4000 analysts, data scientists and domain experts, WNS Triange helps translate data into actionable insights for impactful decision-making. Built on the pillars of consulting (Triange Consult), future-ready platforms (Triange Nxt), and domain and technology (Triange CoE), WNS Triange seamlessly blends strategy, industry-specific nuances, AI and Machine Learning (ML) operations, and intelligent cloud platforms.
Driving a futuristic edge are WNS Triange’s modular cloud-based platforms and solutions leveraging advanced AI and ML to provide end-to-end integration and processing of data to actionable insights. WNS Triange leverages the combined strength of WNS’ domain expertise, co-creation labs, strategic partnerships and outcome-based engagement models.